PRECIOUS-Gold steadies as early Fed taper fears ebb

  • 9/6/2021
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* Dollar shakes off jobs report blues * Gold to stay above $1,800/oz in near-term - analyst * Silver firms near one-month peak (Updates prices) Sept 6 (Reuters) - Gold prices steadied near a 2-1/2-month high on Monday after weaker-than-expected U.S. non-farm payrolls data drove expectations that the Federal Reserve may go slow on tapering economic support measures. Spot gold was little changed at $1,823.59 per ounce by 1128 GMT. On Friday, prices hit their highest since June 16 at $1,833.80. Trading is expected to be subdued on Monday, with most U.S. markets closed for a holiday. U.S. gold futures eased 0.4% to $1,826.30. Limiting gold’s upside, the dollar index rose 0.1% after falling to a one-month low in the last session. Labor Department data showed on Friday U.S. non-farm payrolls increased by 235,000 jobs last month, far below economists’ expectations of 728,000. “After the labour data disappointed the markets, investors are seeing less pressure on Jerome Powell to start tapering,” said Carlo Alberto De Casa, a market analyst at Kinesis. “The tapering could start probably only in December and these are supportive elements for gold prices,” De Casa said, adding that gold should remain above $1,800 in the near term. Fed Chair Powell hinted last month that strong jobs recovery was a pre-requisite for the central bank to start paring back its asset purchases. Some investors view gold as a hedge against inflation that may follow stimulus measures, while lower interest rates reduce the opportunity cost of holding non-yielding bullion. However, “the price action on Friday reinforces that gold’s upward momentum is waning,” Jeffrey Halley, senior market analyst, Asia Pacific at OANDA said. “After the data, all gold could manage was a modest rally that never threatened the major resistance zone lying between $1830.00 and $1834.00,” Halley noted. Silver was steady at $24.70 per ounce after hitting a near one-month high on Monday. Platinum fell 0.6% to $1,019.86, while palladium fell 0.4% to $2,412.96. (Reporting by Brijesh Patel in Bengaluru; Editing by Ramakrishnan M. and Shounak Dasgupta) Our Standards: The Thomson Reuters Trust Principles.

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