Gold prices pulled back slightly amid commodity index rebalancing and a stronger U.S. dollar, with investors positioning themselves ahead of the crucial U.S. non-farm payrolls (jobs) report. Bullion markets remained cautious as traders awaited fresh economic signals that could influence Federal Reserve policy direction.
Market Movements
- Spot gold dipped about 0.4 %, with prices trading near $4,458 per ounce in early Asia trade, pressured by adjustments to commodity index weightings and firm dollar demand.
- U.S. gold futures for February delivery were mixed, reflecting near-term volatility.
- The U.S. dollar strengthened as traders awaited the release of key U.S. employment data and watched for potential impacts from U.S. Supreme Court rulings, which made gold more expensive in other currencies and weighed on demand.
Why the Pressure on Gold?
Investors often adjust holdings before big macroeconomic releases like the U.S. jobs report, which can provide clues on future interest rate moves by the Federal Reserve. A stronger dollar typically reduces appeal for non-yielding assets like gold, while index rebalancing can trigger systematic selling by funds tracking commodity benchmarks.
Broader Outlook
Despite the recent decline, gold prices were still positioned for a weekly gain, supported by earlier strength and broader uncertainty in global markets. Traders are now balancing near-term technical pressures with longer-term safe-haven demand tied to economic and geopolitical risks.
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