Gold prices fell below the key $4,400 level on Monday after a stronger-than-expected U.S. jobs report pushed traders to raise their expectations for a Federal Reserve interest rate hike. Spot gold declined 0.7% to $4,398.89 per ounce, while gold futures dropped 0.7% to $4,444.11. The U.S. Labor Department reported that employers added 162,000 jobs in August, exceeding analyst forecasts, with the unemployment rate holding steady.
The data changed market pricing for the Fed’s September 15-16 meeting. Markets now assign about a 60% chance of a 25 basis point rate hike, up from lower odds before the payrolls release. ING analysts said the expected hike could support the dollar, especially against low-yielding currencies. Because gold is priced in dollars, a stronger greenback adds pressure on the metal.
Oil markets added to inflation concerns after Iran said it targeted tankers in the Strait of Hormuz, with Brent crude trading near $97 per barrel. Gold has also fallen below its 200-day moving average near $4,526. For crypto markets, the same forces—higher rate expectations, a stronger dollar, and elevated inflation risks—can reduce appetite for risk assets. Key U.S. producer price data is due Thursday, followed by consumer price data Friday.
