Gold prices were broadly stable on Friday as investors prepared for the September U.S. employment report, with the dollar remaining close to a 17-month high and Treasury yields staying elevated.
Spot gold gained 0.1% to $4,179.65 an ounce as of 06:47 GMT, while U.S. gold futures increased 0.2% to $4,210.15.
The precious metal was heading for its second consecutive weekly decline, having fallen 2.5% since the beginning of the week.
The U.S. Dollar Index eased 0.2% on Friday but remained near the 17-month high recorded in the previous session. It was on course to gain around 1% for the week. A higher dollar can make dollar-denominated gold more expensive for buyers using other currencies.
Treasury yields also remained at elevated levels. The benchmark U.S. 10-year yield briefly climbed to 5.344% on Thursday, its highest level since 2002, before retreating to approximately 5.25% on Friday.
Higher bond yields can increase the relative opportunity cost of holding gold because the metal does not generate interest income.
September Jobs Report Could Inform Fed Expectations
Attention is centred on September’s U.S. nonfarm payrolls report, which is due later on Friday and will provide additional information on labour-market conditions.
Economists expect U.S. employers to have added approximately 90,000 jobs during September, down from 162,000 in August. The unemployment rate is forecast to remain at 4.1%.
The Federal Reserve raised its benchmark interest rate by 25 basis points last month to a range of 3.75% to 4.00%, its first increase in three years.
Market expectations for another increase in October have subsequently declined following lower inflation readings. The supplied information indicated that markets were assigning an approximately 26% probability to an October increase, compared with 69% a week earlier.
Gold had received support earlier in the week after U.S. inflation figures came in below expectations, reducing expectations for another near-term increase in interest rates.
Oil prices are also being monitored because sustained increases in energy costs could contribute to inflationary pressures. At the same time, elevated government bond yields can affect demand for non-interest-bearing assets such as gold.
Silver, Platinum and Copper Move Higher
Other precious and industrial metals recorded modest gains during Asian trading hours.
Silver increased 0.2% to $61.05 an ounce, while platinum rose 0.4% to $1,733.60 an ounce.
Benchmark copper futures on the London Metal Exchange advanced 0.2% to $14,298.33 a tonne. U.S. copper futures gained 0.4% to $5.57 a pound.
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