| Gold held a decline, after stronger-than-expected US payrolls data and escalating tensions in the Middle East raised the prospects for an interest-rate hike as early as next week. Bullion was little changed near $4,425 an ounce, after falling 1% in the previous session. US job growth surged in August and the unemployment rate held steady, according to numbers published Friday, bolstering the argument for raising rates at the Federal Reserve's Sept. 15-16 meeting.  A gauge of the dollar rose on Friday, making gold that's priced in the US currency more expensive for many buyers. Traders also dialed up rate-hike bets, pricing in a roughly 60% likelihood of an increase in September. Higher borrowing costs typically undermine support for bullion, because the precious metal doesn't pay interest. Adding to fears around inflation, Iran said it targeted three oil tankers in the Strait of Hormuz as well as a number of US-linked ships in retaliation for American attacks on vessels over the weekend. The skirmishes raised fresh concerns around energy flows from the region. Oil prices climbed, with benchmark Brent crude near $97 a barrel. "Gold is being pulled into the heart of another macro storm," said Hebe Chen, senior analyst at Vantage Markets in Melbourne. "Surging oil prices, elevated Treasury yields and an increasingly stronger Fed-hike case after Friday's robust jobs report are bringing back the familiar headwinds," she added. Since bouncing back from a floor near $4,000 an ounce in July, bullion has settled in a relatively narrow range. The metal swung either side of $4,400 last week as traders repeatedly reassessed the outlook for the Fed's monetary policy. Consumer price data due later this week will provide vital clues to the central bank's likely decision on rates. ALSO READ: Gold, Silver Prices Likely To Face Volatility This Week As Iran Tensions Take Centre Stage: Analysts "Another firm PPI or CPI print could reinforce the renewed tightening story, crack that $4,400 defense and deepen the downside move," Chen said. "Softer inflation could temporarily take some pressure off gold, but at this stage it may prove more of a reprieve than a reset." Spot gold was 0.1% lower at $4,425.37 an ounce at 8:28 a.m. in Singapore. Silver was little changed at $66.24 an ounce. Platinum dropped, while palladium edged higher. The Bloomberg Dollar Spot Index fell marginally after adding 0.1% on Friday. |
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