Gold eases as strong US jobs data boosts Fed rate-hike bets

Inflation worries remained high as a weekend exchange of strikes on shipping sent oil prices higher, while Iran said it will announce a new restricted zone in the Gulf in the coming days, along with maps of a new shipping corridor through the Strait of Hormuz. O/R

Although gold is typically seen as an inflation hedge, higher interest rates tend to diminish non-yielding bullion's appeal to investors.

However, U.S. President Donald Trump on Friday said that unless the Fed cut rates, something that he has demanded previously, he would stop trading with countries with which the United States had a deficit.

Among other metals, spot silver XAG= slid 0.3% to $65.98 per ounce, platinum XPT= dipped 0.2% to $1,823.58, and palladium XPD= climbed 0.1% to $1,388.17.

"Gold and silver have moved in the opposite direction to energy prices, extending their declines after Friday’s strong U.S. jobs report lifted bond yields and reinforced expectations of a Fed rate hike on 16 September," said Ole Hansen, head of commodity strategy at Saxo Bank.

"In today’s session, gold has twice found buying interest below $4,400, well ahead of key support around $4,320, while resistance continues to emerge above $4,500."

Data last week showed U.S. job growth accelerated sharply in August, while the unemployment rate held steady at 4.1%.

Traders see a 60% chance of an interest rate hike at the central bank's policy meeting next week, according to the CME FedWatch Tool, compared with a probability of 50% before the jobs data was released on Friday.