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Gold falls amid firm dollar, Fed's taper talk jitters

Reuters2021-08-06

Aug 6 (Reuters) - Gold prices eased on Friday as the dollar held gains ahead of the much-anticipated U.S. jobs data, while a growing number of Federal Reserve officials signalled the possibility of a sooner-than-expected policy tightening.

FUNDAMENTALS

Spot gold fell 0.1% to $1,802.05 per ounce by 0104 GMT. U.S. gold futures eased 0.3% to $1,804.10.

The dollar index was up 0.1%, making gold more expensive for holders of other currencies.

Fed Governor Christopher Waller said it may be possible for the U.S. central bank to start withdrawing its accommodative monetary policy sooner than some expect given the progress in economic recovery and improving labour market.

Meanwhile, Minneapolis Fed President Neel Kashkari said the Delta variant of COVID-19 could throw a "wrinkle" into the labour market recovery and the timeline for a reduction in the Fed's asset-purchase program.

Daily new COVID-19 cases have climbed to a six-month high in the United States, with more than 100,000 infections reported nationwide as the Delta variant ravaged states with lower vaccination rates.

Investors are now focused on U.S. non-farm payrolls report, due later in the day, seen as key to Fed's policy stance.

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell to 1,027.61 tonnes on Thursday.

India's gold imports in July more than doubled from a year earlier as demand improved after states lifted lockdown restrictions, a government source said.

Russia produced 79.05 tonnes of gold in the first four months of 2021, down from the 81.27 tonnes it produced in the same period in 2020, its finance ministry said on Thursday.

Silver rose 0.1% to $25.15 per ounce and palladium was flat at $2,649.45.

Platinum hit an over seven-month low of $998 and was last down 0.6% at $999.49.

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