Gold prices have fallen sharply: the main reasons
8 June 15:07
Gold prices fell to a more than two-month low on Monday, June 8: strong U.S. jobs data reinforced expectations of a rate hike by the Federal Reserve, while the exchange of strikes between Israel and Iran pushed oil prices higher, fueling inflation fears. This is reported by "Komersant Ukrainian" citing Reuters.
The spot price of gold fell 1.15% in the first half of the day to $4,278.92 per troy ounce, hitting its lowest level since the second half of March.
“Spot gold fell to a two-month low as markets now expect the Fed to raise rates this year following another strong U.S. jobs report,” said Khan Tan of Bybit.
Nonfarm payrolls in the U.S. economy rose by 172,000 in May—twice the forecast—according to data from the Bureau of Labor Statistics on Friday, June 5.
Markets are now pricing in a more than 70% probability of a Fed rate hike in December, up from 45% a week earlier, according to data from the CME’s FedWatch tool.
The yield on 10-year U.S. Treasury bonds rose to a two-week high, increasing the cost of holding the precious metal, which does not generate interest income. The focus this week will be on the U.S. Consumer Price Index on Wednesday and producer price data on Thursday.
“Gold may continue to test the psychologically important $4,000 support level if the CPI comes in higher than expected or the Fed maintains a decidedly hawkish tone next week,” Tan added.
Palladium fell 0.71% to $1,217.23 per ounce, while silver dropped 1.48% to $66.81 per ounce.
The price of platinum fell 1.29% to $1,753.95.
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