(Bloomberg) -- Gold declined below $1,700 an ounce after US jobs data showed the labor market remains tight, dashing hopes the Federal Reserve will become less aggressive with rate hikes.
Nonfarm payrolls rose 263,000 last month, slightly higher than economists' estimates, while the unemployment rate declined. The dollar and Treasury yields climbed following the data release, putting pressure on gold, which fell as much as 1.3%.
The data will keep the Fed on a hawkish track as it tries to cool the US labor market, which has helped drive inflation to the highest in decades. The central bank's relentless rate hikes have weighed on gold throughout the year, causing it to slide about 18% from a March-high.
Weaker data earlier in the week on US manufacturing and job openings fueled expectations that the Fed may slow its aggressive rate hikes, sparking gold's climb above $1,700. Fed officials have still been insistent inflation remains too high and they won't be deterred from tightening policy by volatility in the markets.
Spot gold lost 0.9% to $1,696.70 an ounce as of 1:58 p.m. in London, after slipping 0.2% in the previous session. The Bloomberg Dollar Spot Index strengthened 0.3%. Silver and palladium declined, while platinum gained.
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