Gold see-saws in tight range as focus stays on U.S. labour data

(Reuters) – Gold traded within a narrow range on Wednesday, as investors largely looked past a slew of U.S. economic readings to focus on key labour data that could influence the Federal Reserve’s tapering plans.

FILE PHOTO: Gold bullion is displayed at GoldSilver Central’s office in Singapore June 19, 2017. REUTERS/Edgar Su/File Photo

Spot gold was little changed at $1,812.51 per ounce by 10:40 am EDT (1440 GMT), while U.S. gold futures eased 0.3% to $1,813.30.

Bullion largely tracked moves in the dollar, which retreated slightly after the ADP National Employment Report showed U.S. private employers hired far fewer workers than expected in August, but subsequently pared some of those losses on data showing an uptick in manufacturing.

The greenback’s moves influence gold since they make bullion cheaper or expensive for those holding other currencies.

While gold did get a little boost from the dollar’s initial retreat, “the trend suggests it’s getting exhausted,” said Bob Haberkorn, senior market strategist at RJO Futures

Also, the boost gold got from the Fed last week after Chair Jerome Powell said that although tapering could begin this year, the central bank would take a cautious approach to raising interest rates, is starting to die out, thanks to expectations for a strong number in Friday’s jobs data, Haberkorn added.

Bullion, considered a hedge against inflation and currency debasement had gained on the back of massive stimulus from global central banks. Higher interest rates translate into increased opportunity cost for holding non-yielding bullion.

Economists polled by Reuters predicted the U.S. non-farm jobs report for August on Friday would show payrolls increased by 750,000.

If the data exceeds expectations, this might lead to a stronger dollar and put “some pressure on gold”, said Commerzbank analyst Daniel Briesemann.

Meanwhile, silver rose 1.2% to $24.16 per ounce, while platinum eased 1.2% to $1,000.25. Palladium fell nearly 1% to $2,442.65.

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