Gold rally cools as dollar holds ground, US jobs data in focus

By Anushree Ashish Mukherjee

(Reuters) – Gold slipped on Tuesday after grazing an all-time high in the previous session as the dollar regained footing and investors refrained from making big bets ahead of key U.S. jobs data that could offer more clarity on the U.S. interest rate path.

Spot gold was down 0.5% at $2,020.29 per ounce by 3:10 p.m. ET (2010 GMT). Bullion had climbed to a record high of $2,135.40 on Monday, before dropping more than $100 in a single day to close over 2% lower.

U.S. gold futures settled down 0.3% at $2,036.30.

The momentum that propelled gold to a record high on Monday may fizzle in the short term due to uncertainty over the timing of U.S. monetary easing, but wider geopolitical risks should give a boost towards fresh peaks, analysts said.

Gold bulls are exhausted and hitting a pause after the rally, said Jim Wyckoff, senior analyst at Kitco Metals, adding that “the $2,000 level is probably going to be the near-term floor under the gold market.”

The dollar rose 0.2% to hover near a two-week high, making gold more expensive for other currency holders. [USD/]

Traders are now pricing in a 66% chance of a rate cut in March, according to the CME FedWatch tool. Lower interest rates tend to support non-interest-bearing bullion.

“We only expect the (gold) price to rise lastingly to $2,100 per troy ounce in the second half of 2024, when the Fed begins lowering its interest rates,” Commerzbank said in a note.

Data showed U.S. job openings fell to a more than two-and-a-half year low in October, signalling that higher interest rates were dampening demand for workers.

Investors are on the watch for Friday’s U.S. non-farm payrolls report for November.

Spot silver lost 1.4% to $24.16 per ounce, while platinum eased 1.8% to $899.80.

Palladium slipped 4.1% to a more than five-year low of $936.24 per ounce.

(Reporting by Anushree Mukherjee and Brijesh Patel in Bengaluru; Editing by Nick Zieminski, Shinjini Ganguli and Maju Samuel)