US labor data showed the jobless rate fell to a two-year low of 3.6% and wages reaccelerated, positioning the Fed to raise interest rates by 50 basis points in May.
The data also fueled gains in 10-year US Treasury yields and the dollar. According to the operators, this makes “gold less attractive to foreign buyers”.
“Expectations of a rate hike are putting pressure on gold”said Bart Melek, chief commodity strategist at TD Securities, as that “would translate to a higher opportunity cost of holding gold that doesn’t yield a return.”
However, he added that “(the Fed’s) monetary policy has a long way to go to be even neutral…and gold will continue to be quite firm.”
In other precious metals, spot silver dipped 0.5% to $24.65 an ounce, down 3.4% on the week. Platinum lost 0.2% to $981.53; while palladium gained 0.4% to $2,271.46. However, both metals posted a fourth straight week down.
Source: Ambito
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