After an uptick in the unemployment rate in the United States raised expectations of a pause in the Federal Reserve’s interest rate hikes, gold pared some of its early gains on Friday but was still expected to rise for the week.
At 1:49 p.m. EDT (1749 GMT), spot gold was up 0.1% at $1,940.94 per ounce after climbing as high as 0.6% earlier in the day. After prices reached one-month highs on Wednesday, it was expected to increase 1.4% over the previous week.
The price of U.S. gold futures for December delivery increased by 0.1% to $1,967.10.
According to data from the Institute for Supply Management (ISM), manufacturing in the United States shrank for the tenth consecutive month in August, but the rate of decrease slowed down.
The gold rise has been restricted by the ISM report to a short-term range trade, perhaps between $1,920 and $1,960. The gold market might wait for additional hints about the Fed’s intentions during its meeting in September, which will feature a new set of dots, according to independent metals dealer Tai Wong, headquartered in New York.
After the manufacturing report, U.S. bond yields and the dollar recovered some of their earlier losses, which put more pressure on non-yielding bullion.
After hitting resistance near the $1,975 mark in the December contract, gold also had a technically driven drop, according to David Meger, director of commodities trading at High Ridge Futures.
However, statistics released earlier in the session showing an increase in the unemployment rate and a deceleration in wage growth bolstered expectations that the Fed would not hike interest rates this month, halting falls in non-yielding gold.
According to the CME Group’s FedWatch tool, wagers on the Fed keeping rates steady in September increased to 93.0% from 89% before the jobs report.
While platinum slipped 0.6% to $961.58 but was still on track to achieve its second straight weekly gain, silver fell 0.9% to $24.22 per ounce.
At $1,225.98, palladium was up 0.9%.