Gold futures trimmed down 0.12% to $1,889.75 by 12:04 PM ET (4:04 AM GMT). The dollar, which normally moves inversely to gold, crept up on Monday while the benchmark 10-year U.S. Treasury yield slid under 1.6%.
On Friday, data published Friday stated that nonfarm payrolls in May rose to 559,000. This is higher than April’s 278,000 reading. However, under 650,000 figure in calculations made by Investing.com. The lower-than-expected figure soothed investors’ anxieties regarding potential runaway inflation and earlier-than-expected interest rate hikes.
Meantime, U.S. Treasury Secretary Janet Yellen stated on Sunday that U.S. President Joe Biden’s $4 trillion spending plan would be desirable for the U.S. even if it results in inflation that continues into 2022 and interest rate hikes.
If we ended up with a somewhat higher interest rate environment, it would be a plus for society’s perspective and the Fed’s point of view, Yellen reported Bloomberg.
Some Investors Endured Tentatively Optimistic
We see some long covering in Asia today, with risk hedges being rested after an unexciting news weekend, supported by a slightly stronger dollar. With Bitcoin rallying, although gold has changed in recent sessions, the bullish fundamentals rest in place. Only a definite steepening of the U.S. yield curve is likely to shift that, Jeffrey Halley, OANDA senior market analyst, said Reuters.
Investors now expect the European Central Bank’s policy decision to come on Thursday. The Fed should also meet from Jun 15 to 16.
On the demand front, India, the second-largest gold customer globally, posted the most substantial discounts in eight and a half months last week. In addition, Johns Hopkins University data stated that India’s number of coronavirus cases exceeded 28.8 million as of Jun 7.
In other precious metals, silver fell 0.7%, and palladium dropped 0.3%, while platinum bound up 0.2%.