Gold price slides 1% in global market
Gold prices fell as much as 1 per cent to slip below $2,000 on Monday, after US employment data pointed to a tight labour market, raising expectations of another rate hike by the Federal Reserve in May.
Spot gold was down 0.8 per cent at $1,992.97 per ounce, as of 0613 GMT. US gold futures slipped 0.9 per cent to $2,007.80.
Gold slid due to "profit-booking on expectations of Fed rate hikes followed by Friday's strong US job growth report and a steady dollar," Hareesh V, head of commodity research at Geojit Financial Services, said while noting a technical correction in prices.
The dollar index was 0.1 per cent higher, making bullion expensive for overseas buyers.
Friday's data from the US Labor Department showed non-farm payrolls increased by 236,000 jobs in March, versus expectations of 239,000. The data also showed the unemployment rate dipped to 3.5 per cent from 3.6 per cent in the prior month.
The report raised bets that the US central bank would increase rates next month, with markets pricing in a 63.4 per cent chance of a 25 basis-point (bps) hike, according to the CME FedWatch tool.
But "the short-term outlook remains bullish for gold. As long as prices stay above $1,920, there are chances for the bullish outlook to continue," Geojit's Hareesh added.
Gold is traditionally considered a hedge against inflation, but higher rates increase the opportunity cost of holding the non-yielding asset.
"The bull trend, established since November 2022, is still intact," metals firm MKS PAMP said in a note, adding a "stickier" core US CPI on Wednesday would solidify a 25 bps hike and ensure that unless there's a new catalyst, gold prices might not hit all-time highs this month.
Spot silver shed 1 per cent at $24.75 per ounce, platinum lost 0.7 per cent to $1,000.78 and palladium eased 0.1 per cent to $1,464.79.
Australia, Hong Kong and European markets are closed on Monday for the Easter holidays.
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