Gold slips as focus shifts to United States payrolls data

The pace of rate hikes is heavily dependent on USA economic data.

Fischer said on Friday that an interest rate hike could come in September and that the Fed’s decision would depend on upcoming economic reports including surveys due this week on employment and the manufacturing and service sectors.

Silver was down 1.3 per cent at $US18.59 an ounce, having hit a two-month low of $US18.36 in the previous session. The advances helped Wall Street snap a three-day losing streak.

In late Tokyo trading, players found it hard to build fresh positions ahead of the release later in the day of the Automatic Data Processing Inc.’s U.S. private-sector job report for August, which precedes the U.S. Labor Department’s employment statistics for the same month, due out Friday, traders said.

Fed Chair Yellen delivered the hawkish message we were looking for on Friday, telling her Jackson Hole audience that the case for raising rates has strengthened recently.

Amid thin volumes in Europe with London shut for a public holiday, the dollar rose 0.5 percent to 102.39 yen, its highest since August 9.

The dollar spiked on Friday after Federal Reserve officials indicated interest rates could rise at least once this year. British markets are closed for a holiday.

On Wednesday, the Sensex ended at 28452.17, up 109.16 points or 0.4%.

The Dow Jones industrial average was last down 65.3 points, or 0.35 percent, at 18,437.69.

S&P 500 e-minis were down 1 point, or 0.05 percent, with 109,032 contracts traded. Germany’s DAX was 1.2% lower, while the blue-chip Euro Stoxx 50 was down 0.6%.

U.S. Treasury yields maturing between 2-10 years dipped on foreign demand after touching their highest levels since June on Friday. U.S. 30-year Treasury bond yields also fell, with their prices rising more than a full point.

The rupee is down 1.5% till date this year, while foreign institutional investors (FIIs) have bought $5.78 billion in equity and sold $1.19 billion in debt markets.

The focus on USA rates put bonds under pressure, with German Bund yields pulled up by 10-year Treasury’s rise to 1.5850 percent [GVD/EUR]. Brent crude, used to price oil internationally, lost 66 cents to $49.26 a barrel. Oversupply remained a major concern, with USA crude stockpiles forecast to have risen by 1.3 million barrels last week, a Reuters poll showed.

Spot gold may retest a support at $1,308 per ounce, with a good chance of breaking below this level, and falling more to the next support at $1,303, according to Reuters technical analyst Wang Tao.