Gold Prices Tick Higher During US Holiday, Focus on Jobs Report

September 3, 2018

London (Sept 3)  Gold prices traded slightly higher on Monday amid thin trade with U.S. and Canadian financial markets closed for their respective Labor Day holidays.

At 10:19 AM ET (14:19 GMT), gold futures for December delivery on the Comex division of the New York Mercantile Exchange gained $2.30, or 0.19%, to $1,206.70 a troy ounce.

Gold prices registered their fifth straight monthly decline in August and are down 7.6% year-to-date, pressured lower by the stronger dollar and rising interest rates. Investors have also shunned the precious metal despite an escalation in global trade tensions, indicating that gold may be losing its safe haven status as traders opt to invest in the dollar.

Last week the U.S. reached a deal with Mexico aimed at overhauling the North American Free Trade Agreement, but talks with Canada stalled hours before a Friday deadline. Separately, the Trump administration is preparing to slap a fresh round of tariffs on Chinese imports in a move that could come as early as this week, escalating a trade row with Beijing.

With no major economic reports out Monday due to the U.S. holiday, investors looked forward to the publication of the August nonfarm payrolls report on Friday. The consensus forecast is for the creation of 191,000 jobs last month, while the unemployment rate is expected to hold steady at 3.9%.

With expectations pointing to another solid reading for the U.S. labor market, the report is not likely to move market expectations for the Federal Reserve to hike interest rates by a quarter point at the next policy meeting on September 25-26.

Fed fund futures currently put the probability of an additional increase in December at just under 70%, according to’s Fed Rate Monitor Tool.

Higher interest rates tend to weigh on demand for gold, which doesn’t bear interest, in favor of yield-bearing investments.

In other metals trading, silver futures rose 0.38% at $14.535 a troy ounce by 10:21 AM ET (14:21 GMT).

Palladium futures slipped 0.01% to $965.90 an ounce, while sister metal platinum traded up 0.25% at $788.00.

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