Gold prices rose on Monday, as a falling dollar prompted investors to cover some shorts, while attention shifted to U.S. jobs data due later this week, which could offer further indications of interest rate cuts by the Federal Reserve.
Spot gold was up 0.2% at $2,330.92 per ounce by 10:02 a.m. ET (1402 GMT). Prices have gained more than 4% in the second quarter. U.S. gold futures gained 0.1% to $2,341.60.
The dollar index fell 0.2% against its rivals, making gold attractive to holders of other currencies.
“We are seeing some hedging by short-term futures traders and some bargain hunting by those in the cash market. Markets are also supported by a stable crude oil price and a firm U.S. dollar weaker,” said Jim Wyckoff, senior market analyst at Kitco Metals.
“We will probably be in a sideways or maybe sideways or lower phase for the rest of the summer,” Wyckoff added.
This week, attention will focus on remarks from Fed Chair Jerome Powell on Tuesday, followed by minutes from the Fed’s latest policy meeting on Wednesday and U.S. nonfarm payrolls data due on Friday.
Data last week showed that U.S. prices remained unchanged in May, while consumer spending rose modestly.
“Powell will likely stick to a data-dependent stance, so if payroll data comes out softer later this week, that could lift gold prices again,” said Giovanni Staunovo, an analyst at UBS.
The market now sees a 64% chance that the Fed will cut interest rates in September and another cut in December.
Lower interest rates reduce the opportunity cost of holding bullion.
Elsewhere, spot silver rose 0.8% to $29.35, platinum slipped 0.6% to $987.05 and palladium gained 1.3% to $985.
