Gold trading on Thursday showed a decline with a rebound in the value of the U.S. dollar after U.S. jobless claims data published the lowest in 52 years that could likely influence policy decisions by the Federal Reserve (Fed) at next week’s meeting.
Spot gold fell 0.3% to around $ 1,776 an ounce while US gold futures also fell 0.5% to around the same price level.
Strong readings of US jobless claims data have prompted a strengthening US dollar and put pressure on gold and investors will focus on the release of US inflation data in the New York session soon.
According to the expectations of the Market Strategy Officer at RJO Futures, the strength of the dollar makes the attraction to gold by outside investors even less. However, if the inflation rate shows an increase, it is likely to push the value of gold to rise again towards the $ 1,800 level.
Entering the eighth day, gold has moved horizontally in the price zone range of $ 1,760 and $ 1,790 after a significant fall in the price of gold below the $ 1,800 level at the end of last November.
Pressure on gold began to mount after investors began to see pull against the US dollar following the Fed's move to tighten its policy by implementing measures to reduce bond purchases (tapering).
However, with the emergence of the risk of transmission of a new variant coronavirus, Omicron is likely to undermine the Fed’s plans. Thus, the price of gold has a chance to rebound if the Fed 'withholds' the policy tightening action.
In addition to Omicron's risks, the market will also focus on tensions between Russia and Ukraine, the issue of the Beijing Olympic boycott of diplomacy and even US sanctions on Iran.
