Gold rises on softer oil prices; US jobs data, Fed rate outlook on tap
GLD•Silver, platinum and palladium also advance
Among other metals, spot silver XAG= gained 2.6% to $59.7 per ounce, platinum XPT= climbed 5.6% to $1,719.49, and palladium XPD= rose 5% to $1,328.00.
Gold gains as lower oil eases inflation fears
Gold prices gained on Tuesday, supported by a decline in oil prices that tempered inflation fears and lowered U.S. interest rate hike bets, while markets awaited further clues on the Federal Reserve's policy path.
Spot gold XAU= rose 0.6% to $4,078.10 per ounce by 09:29 a.m. EDT (1329 GMT), while U.S. gold futures GCcv1 gained 1.1% to $4,134.60.
Oil prices pared gains after Qatar said efforts to secure a diplomatic resolution to the U.S.-Iran conflict were continuing, though disruptions to oil flows through key shipping routes persisted. Brent crude futures LCOc1 were down over 4% on the news. O/R
Fed outlook and U.S. jobs data remain in focus
Lower oil is probably one of the drivers supporting gold prices, said Bart Melek, global head of commodity strategy at TD Securities, adding that the decline in many ways has contributed to the interest rate outlook with short-term rates falling a little bit.
Elevated energy prices reinforce expectations that the Fed will keep interest rates higher-for-longer to combat inflation, weighing on non-yielding bullion.
Earlier on Monday, Fed's New York President John Williams said he remained optimistic that inflation pressures were on track to ease gradually, but if they do not, the U.S. central bank will not hesitate to respond with rate hikes.
Traders are now pricing in about a 61% chance of a rate hike in the central bank's September meeting after a divided Fed kept rates unchanged at its last policy meeting.
Market participants are now awaiting a series of U.S. jobs reports this week, including the ADP employment report due on Wednesday and the nonfarm payrolls data on Friday.
