Gold Tumbles After US Jobs Data Keeps Fed on Hawkish Track

After US jobs statistics revealed the labour market is still tight and the Federal Reserve is maintaining its hawkish policy course, gold prices fell below $1,700 an ounce.

Last month, nonfarm payrolls increased by 263,000, somewhat more than economists had predicted, but the unemployment rate decreased. 

 Following the announcement of the data, the dollar and Treasury yields rose, which placed pressure on gold, causing it to decline by as much as 1.3%.

The report will set the Fed up for another disproportionate interest rate increase as it attempts to temper the US labour market, which has contributed to the strongest inflation in decades.

The central bank's constant rate increases have put pressure on gold throughout the year, forcing it to fall almost 17% from its high in March.

According to Ed Moya, senior market analyst at Oanda, "a strong NFP report kept aggressive tightening by the Fed on the table," putting pressure on gold. "The economy isn't collapsing as quickly as some traders thought,"


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