Gold rises as investors await US data

Spot gold was up 0.3 per cent at $4,091.89 per ounce

Gold prices inched higher on Monday as investors waited for a series of US economic data this week that could shed more light on the Fed’s interest rate path.

Spot gold was up 0.3 per cent at $4,091.89 per ounce, as at 9.14 am. US gold futures for December delivery were steady at $4,094 per ounce.

Focus for this week will also be on US data releases, including the September nonfarm payrolls report on Thursday, for clues on the health of the country’s economy.

The Commerce Department’s Bureau of Economic Analysis said on Friday it was working to update its schedule of economic data releases affected by the recently ended government shutdown.

Traders are currently pricing in a 46 per cent probability of a quarter-point Fed rate cut next month, down from 50 per cent last week.

Citing worries about inflation and signs of relative stability in the labour market after two interest rate cuts this year, a growing number of central bank policymakers are signalling reticence on further easing.

Non-yielding gold tends to do well in a low-interest-rate environment and during times of economic uncertainties.

Meanwhile, the dollar index held firm against its rivals, making gold less attractive for other currency holders.

Physical gold demand across major Asian markets was subdued last week as higher prices curtailed buying activity, with discounts in India reaching their highest level in five months.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings dropped 0.47 per cent to 1,044.00 tonnes on Friday from 1,048.93 tonnes on Thursday.