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Gold prices softer ahead of China trade data expected to set tone

Published 08/07/2016, 09:07 PM
Updated 08/07/2016, 09:09 PM
© Reuters.  Gold drifts lower ahead of China trade data
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Investing.com - Gold prices drifted lower on Monday in Asia as investors awaited trade data from China for direction.

In China, the trade balance for July is expected at a surplus of $47.6 billion, with exports down 3.0% and imports down 7.0%, both year-on-year.

China is the world's top copper importer and second largest gold buyer behind India.

Earlier, in Japan, the adjusted current account us expected to show a surplus of ¥3.20 trillion for July and bank lending is seen up 2.0% year-on-year. In China, FX reserves came in at CNY3.2 trillion, meeting expectations.

Gold for December delivery on the Comex division of the New York Mercantile Exchange fell 0.20% to $1,341.65 a troy ounce.

Also on the Comex, silver futures for September delivery eased 0.18% to $19.780 a troy ounce.

Copper futures for September delivery were flat at $2.160 a pound.

Last week, gold prices plunged to a one-week low on Friday, after data showed the U.S. economy created more jobs than expected in July, raising the probability of an interest rate hike from the Federal Reserve in the coming months.

The U.S. economy added 255,000 jobs last month, well above expectations for 180,000, the Labor Department said on Friday. June’s number was revised up to 292,000 jobs compared with the previous estimate of 287,000.

Meanwhile, the unemployment rate held steady at 4.9%, as more people entered the labor market.

The report also showed that average hourly earnings rose month-on-month by 0.3%, beating expectations for a 0.2% gain. They were up 2.6% on the year.

The upbeat data reignited speculation that the Federal Reserve will lift interest rates this year. Fed funds futures are currently pricing in a 15% chance of a rate hike by September. December odds were at around 44%, up from 33% ahead of the report.

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