Gold Prices Drift Lower Despite Rising Dollar

Yellow metal prices fell at the start of the week, but they remained below a two-and-a-half-month high.

A disappointing U.S. jobs report raised the possibility that the Federal Reserve might delay asset tapering, which boosted the price of gold.

During the previous session, gold futures reached $1,833.80, their highest level since Jun. 16, before declining 0.30% to $1,828.25 early Monday.

Despite Friday’s non-farm payroll report showing 235,000 jobs gained in August, investors are still digesting Friday’s report. Investors now expect the Fed to take a bit longer to begin asset tapering, given the economy’s smallest gains in 7 months and the demand for assets.

The Dollar Index, which moves inversely to gold, also fell after the report. Dollar rose on Monday.

As part of their respective policy decisions, the Reserve Bank of Australia and the European Central Bank will make announcements on Tuesday and Thursday, respectively.

As gold prices bounced back in the previous week, physical gold demand was comparatively muted in Asian hubs. There are, however, tentative hopes that Indian festivals will boost demand this year.

Data provided by the U.S. Commodity Futures Trading Commission showed that COMEX gold and silver net long positions were increased by speculators in the week ended Aug. 31.

A steady price for silver was maintained at $24.69 per ounce. In the previous session, the price increased 3.4%, the largest percentage rise since early May. The platinum price fell 0.6%, while palladium gained 0.2%.