Gold Prices Down In Asia On Profit-Taking, Eye On Dollar Weakness

Investing.com – Gold prices fell in Asia on Monday on profit-taking and as investors keep an eye on the dollar for potential further weakness linked to a more gentle than expected rate hike path by the Fed in 2018 after disappointing jobs data last week.

for February delivery fell 0.11% to $1,320.70 a troy ounce on the Comex division of the New York Mercantile Exchange.

Financial markets in Japan will remain closed for a holiday.

Last week, gold prices edged lower in choppy trade on Friday as investors took profits after the metal’s rally to three-and-a-half month highs earlier in the week and as the dollar pushed higher despite a weaker-than-expected U.S. jobs report for December.

For the week, the precious metal was still up 0.99%, its fourth consecutive weekly gain.

The U.S. economy added 148,000 jobs in December, the Labor Department reported, well below the 190,000 forecast by economists, while the unemployment rate held steady at 4.1%.

Employment data for October and November data were revised to show 9,000 fewer jobs created than previously reported.

Earnings rose by an annualized 2.5% in December, as expected, but November’s wage growth was revised down to 2.4% from 2.5%.

The dollar briefly slid to the day’s lows following the report, before regaining ground.

While the report was disappointing given the miss in jobs growth the rise in wage growth was a bright spot.

The jobs data was seen as unlikely to alter investor expectations for a rate hike by the Federal Reserve at its March meeting.

Fed funds futures have priced in a more than 67% chance the U.S. central bank will hike interest rates in March, according to Investing.com’s Fed Rate Monitor tool.

Gold is highly sensitive to rising U.S. interest rates, as they increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.

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