Key facts
- Gold pared earlier gains after strong US jobs data.
- Strong US jobs data reinforced expectations of higher-for-longer interest rates.
- The Federal Reserve is expected to keep rates higher for an extended period.
- Higher interest rates typically act as a headwind for gold.
- The dollar index declined by 0.05% to 99.13.
- The euro rose by 0.12% against the dollar to $1.1645.
Gold trimmed earlier gains following the release of robust US jobs data. This economic indicator reinforced market expectations that the Federal Reserve will maintain its policy of higher interest rates for a prolonged period. Such a monetary policy environment typically presents a headwind for non-yielding assets like gold, as it increases the opportunity cost of holding the precious metal. The dollar index declined by 0.05% to 99.13, while the euro rose by 0.12% against the dollar to $1.1645.