XAU/USD holds below $2,300 as China stops buying gold, US Dollar rebounds
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Gold price remains on the defensive around $2,295 in Friday’s early Asian session. The US economy added 272K jobs in May, above expectations of 185K new roles. The Chinese central bank paused gold purchases in May after 18 months of buying. Gold price (XAU/USD) trims losses near $2,295 despite the stronger US Dollar (USD) on Monday during the early Asian session. The yellow metal edges lower to one-month lows on Friday amid lower bets on US Federal Reserve (Fed) rate cuts this year and bearish sentiment fueled by news indicating that China paused gold purchases in May after 18 months of buying. The US employment data came in better than expected and prompted traders to push back the expected timing of Fed rate cuts. On Friday, the US Nonfarm Payrolls (NFP) for May rose 272K from a 165K increase in April (revised from 175K), according to the US Bureau of Labor Statistics (BLS). Meanwhile, the Unemployment Rate increased to 4.0% in May from 3.9% in April. The US Dollar (USD) attracts some buyers in response to the stronger data and weighs on the gold price as it makes bullion more expensive for overseas buyers. The gold market is seeing a bit of liquidation, along with other metals since the data shows the US economy is quite robust and the Fed may delay that first rate cut, said Blue Line Futures chief market strategist, Phillip Streible. The financial markets are now pricing in nearly 49% odds of a rate cut for the September meeting, down from 68% before the NFP data, according to the CME FedWatch tool. Furthermore, the People’s Bank of China (PBOC), one of the world’s biggest gold buyers for years, snapped 18 months of continuous gold buying in May as the price hit record highs in April and May, per Bloomberg. The…
Filed under: News - @ June 10, 2024 1:06 am