Gold is silent as US jobs data raise doubts about the path of the Federal Reserve’s rate hike

The dollar index rose to its highest level in 20 years
* Speculators cut net long position in Comex Gold – CFTC

* China’s heavy platinum imports lead to shortages elsewhere – WPIC

(Reuters) – Gold prices stabilized on Monday after posting its best day in a month in the last session after the US jobs report showed the unemployment rate rose in August, suggesting that the Federal Reserve may slow the pace of interest rate hikes.

Spot gold settled at $1,710.70 an ounce by 0737 GMT. US gold futures fell 0.2 percent to $1,719.70. Gold rose 1.3% on Friday after data showed that US employers hired more workers than expected in August, but moderate wage growth and a rise in the unemployment rate to 3.7% indicate that the labor market is beginning to decline.

“With the Fed meeting just over two weeks away and the ‘blackout period’ fast approaching, any comments from Fed members this week will be scrutinized by traders as they have the potential to move the needle on Fed policy,” said Matt Simpson. Chief Market Analyst at City Index. “Any comments suggesting a 75 basis point hike could keep gold prices under pressure.”

The Fed’s next policy meeting is scheduled for September 20-21.

“Gold rose on Friday as more Americans returned to the workforce. Any easing of the tight labor market would help the Fed tame inflation and possibly reduce its need to tighten interest rates aggressively,” ANZ said in a note.

Gold tends to perform poorly in a high interest rate environment because it does not generate any interest. The dollar index hit a 20-year high, making gold too expensive for holders of other currencies.

The US Commodity Futures Trading Commission (CFTC) said on Friday that speculators reduced net long positions in COMEX gold by 9,599 contracts to 20,726 in the week ending August 30, while net short positions in silver increased in COMEX.

Spot silver rose 0.4% to $18.10 an ounce, platinum rose 0.5% to $839.38 an ounce, while palladium rose 0.9% to $2,040.49.

The World Platinum Investment Council said stronger-than-expected platinum shipments to China in the first half of the year led to shortages elsewhere, as supply from mines and recycling fell.

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