Gold falls for fifth session in row

On the Comex division of the New York Mercantile Exchange, gold for December delivery traded down 0.13% to $1,112.30 a troy ounce.

Gold fell from one-month highs on Friday after Federal Reserve Chair Janet Yellen kept the door open to a hike in interest rates later this year, sparking a rally in the dollar.

The Fed will likely respond to encouraging data on the U.S.jobs market by tightening before year’s end.

Economists polled by Reuters expect Friday’s nonfarm payrolls report to show USA employers hired 203,000 workers in September, improving from August’s 173,000 increase.

Friday’s moves underscore how United States interest rate expectations have come to dominate trade in the precious metal, which recently appears to have lost its status as a safe-haven, a few analysts say. Though other data showed factory activity in the US Midwest contracted, investors cheered the jobs data, sending the dollar up on hopes of a rate hike this year. The strong vehicle demand is seen as bullish for palladium, though platinum is still suffering after Volkswagen’s emissions scandal last week raised concerns about diesel engine demand.

The metal is broadly used in autocatalysts, especially the diesel powered engines.

Even with the sizable early gains, gold is on track to snap a two-week winning streak and log a weekly loss of 1.2%.

Decent volume in November and December put options, which give the holder the right to sell at a strike price of US$1,100 an ounce, suggested investors were protecting their downside risk and hedging their new long futures positions, traders said.

Gold may hold above $1,100 in the early part of this quarter before testing the support level of $1,080 as prospects for a rate rise in December loom, according to Howie Lee, an analyst at Phillip Futures Pte in Singapore.

Among other precious metals, silver rose 5.2% to $15.263 an ounce, platinum rose 0.5% to $909.50 and palladium ended up 4.4% at $697.60 an ounce. The metal, used in catalysts for gasoline-powered cars, was set to log its best month since July 2013, up 10 percent, though it was still headed for a narrow quarterly loss.

Platinum prices fell below $900 an ounce on Tuesday for the first time since January 2009, hurt by fears that the Volkswagen emissions scandal would cut demand from carmakers and perceptions that the market remains oversupplied.