Investing.com - Gold prices headed higher in mid-morning trade as the safe-haven metal finally sparked buyer interest amid U.S.-China trade worries, while a weaker-than-expected reading on job creation also helped reduce worries over a faster pace of rate hikes from the Federal Reserve.
At 10:53 AM ET (14:53 GMT), gold futures for December delivery on the Comex division of the New York Mercantile Exchange gained $9.30, or 0.70%, to $1,210.60 a troy ounce.
Meanwhile, the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, lost 0.16% to 94.92.
The softer dollar helped support gold, though markets’ focus remained centered on the U.S. - China trade dispute amid fears that an escalation could be imminent.
U.S. President Donald Trump could slap tariffs on an additional $200 billion worth of imports from China when a public consultation period ends later Thursday.
China has warned that it will retaliate if the U.S. imposes fresh tariffs on its goods.
In economic data, the private payroll processor ADP reported that the U.S. created only 163,000 jobs in August, well below the 191,000 positions expected in the official government data out Friday.
The worse-than-expected reading helped to ease concerns that the Federal Reserve could take a more aggressive stance on policy tightening.
Markets already expect the Fed to hike interest rates by a quarter point at the next policy meeting on Sept. 25-26.
Fed fund futures currently put the probability of an additional increase in December at just above 70%, according to Investing.com’s Fed Rate Monitor Tool.
Higher interest rates tend to weigh on demand for gold, which doesn’t bear interest, in favor of yield-bearing investments.
In other metals trading, silver futures gained 0.28% at $14.260 a troy ounce by 10:43 AM ET (14:54 GMT).
Palladium futures rose 0.53% to $960.70 an ounce, while sister metal platinum traded up 1.12% at $793.10.
In base metals, copper advanced 1.57% to $2.651 a pound.