Gold steadied below a seven-week high on Tuesday as the dollar regained momentum, although uncertainty about the timing of a U.S. interest rate hike kept bullion above $1,200 an ounce.
Friday’s bleak U.S. non-farm payrolls data fuelled expectations that the Federal Reserve could delay an anticipated rate increase this year, boosting gold’s safe-haven appeal. U.S. jobs posted the slowest growth in more than a year in March.
New York Fed President William Dudley said the timing of the U.S. rate hike, which would be the first in nearly a decade, is unclear and policymakers must watch that the U.S. economy’s surprising recent weakness does not signal a more substantial slowdown.
“We haven’t changed our expectation of a mid-year rate hike but the weak number we had on Friday certainly eschews the risk towards more of a later rather than an earlier hike,” said Victor Thianpiriya, analyst at Australia and New Zealand Bank.
Spot gold was nearly flat at $1,213.11 an ounce at 0631 GMT. It hit a high of $1,224.10 on Monday, its loftiest since Feb. 17.
U.S. gold for June delivery slipped 0.4 percent to $1,213.50 an ounce.
Thianpiriya said he still expects gold to drop to $1,100 by end-June, under pressure from a firmer dollar. A stronger greenback makes dollar-denominated assets such as gold more expensive for holders of other currencies.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.