Gold showed some correction from nearly three month low, reached on Friday as the US dollar hiked against all of its major counterparts and commodities on rate-hike speculation
Optimistic non-farm payrolls data, showing and increase by 280,000 new employees in the US economy during the month of May boosted the greenback to new highs (even to 13-yr high against the Japanese yen).
Motivated by the most-watched labor data, speculators remained focused on September meeting as the one, where the liftoff may be done for the first time. June has been already left from the bets as first quarter proved to be disappointing.
Gold was dragged down on Friday by this development and the SPDR Gold Trust, the largest gold-backed exchange-traded fund, experienced an outflow by 0.17% to 708.70 tonnes, confirming concerns due to dollar’s strengthening.
Moreover, US Commodity Futures Trading Commission informed on Friday, that in the week until June 2 net long positions in gold and silver dropped.
Due to data-boosted dollar, recovering from the poor two months since March on Q1 disappointment, we may expect the gold futures to extend their losses from a long-term perspective as September remains in the game for the first rate-hike timing and the $1,150 level may be easily broken to even $1,142 an ounce.
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