Gold Falls At The Top Of The Market, China Stops Buying Immediately!


Gold pared its losses below the $2,300 level as the USD continued to strengthen at the opening of trade earlier in the week.

The metal commodity plunged sharply on Friday amid lower bets for Federal Reserve (Fed) interest rate cuts as well as encouragement that China stopped buying gold after 18 consecutive months.

Meanwhile, the price of gold is now at $2,294.99 which is up by 0.5% since it opened in the early Asian trading session this morning.

Last week, US jobs data was better than expected and prompted market participants to discount further forecasts of rate cuts by the Fed.

The US Non-Farm Payroll (NFP) report for May increased by 272,000 from 165,000 in April and the unemployment rate increased to 4.0% in May compared to 3.9% for April.

Meanwhile, the US dollar currency also attracted buying sentiment in response to stronger data and made the price of physical gold more expensive for overseas markets.

Previously, XAU/USD witnessed a significant decline after the US economic data was seen as relatively robust and the Fed potentially delayed the period of its interest rate cuts. The market predicts almost 49% for the occurrence of policy easing compared to 68% previously.

The People's Bank of China (PBOC), the world's largest buyer of gold, announced that it will end its 18-month long gold buying spree in May when the price hit an all-time high.

Concerns about a decline in demand in the future will put some pressure on the precious metal.

China recorded holdings of 72.80 million troy ounces of gold at the end of May, which is roughly the same as in April. Its ownership value increased to $170.96 billion at the end of May from $167.96 billion in April.