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New York - Gold climbed from a four-week low as investors awaited a US labour report for clues to the strength of the world’s largest economy amid bets the Federal Reserve will increase interest rates in December.
Bullion for immediate delivery rose as much as 0.4% to $1 138.40 an ounce before trading at $1 138.30 at 08:25, according to Bloomberg generic pricing. Prices fell as much as 0.8% to $1 132.77 on Monday, the lowest level since October 5, dropping for a fourth day.
The precious metal is headed for a third annual loss on the prospect of Fed policy makers raising borrowing costs for the first time since 2006, diminishing the metal’s appeal because it doesn’t pay interest.
The probability that US central bankers will act at their December meeting was at 50% on Tuesday from a 34% chance at the start of last week, futures contracts show. Payrolls data due November 6 will help to determine the path of monetary policy, according to Argonaut Securities.
“If the jobs data is bad, gold may rise again,” said Helen Lau, an analyst at Argonaut in Hong Kong. “Near-term Fed rate hike in December is an overhang on gold prices.”
The consensus forecast for October payrolls is 184 000 compared with 142 000 a month earlier, according to a Bloomberg survey. The unemployment rate is projected to hold at 5%.
Holdings in exchange-traded products backed by gold shrank 3.4 metric tons to 1 536.26 tons on Monday, the lowest since October 13.
Bullion of 99.99% purity fell as much as 0.6% to $1 138.13 an ounce on the Shanghai Gold Exchange and was at 232.45 yuan. Spot silver, platinum and palladium advanced on global markets.
