Summary Gold rose as weaker-than-expected U.S. jobs data and falling oil prices eased inflation fears, while investors awaited nonfarm payrolls for Federal Reserve policy signals
(Reuters) - Gold prices rose on Thursday as softer-than-expected U.S. jobs data and lower oil prices eased inflation concerns, while investors awaited the nonfarm payrolls report for cues on the Federal Reserve's policy path.
Spot gold rose 0.9% to $4,065.51 per ounce, as of 0425 GMT, after touching its highest level since June 23 in the previous session. U.S. gold futures for August delivery inched 0.1% lower to $4,078.20.
The bullion rebounded from a more than seven-month low to close higher at $4,029.89 on Wednesday after data showed U.S. private employment rose by 98,000 jobs in June, below economists' expectations of 118,000.
"The market's cautious about being short down here because you're seeing a couple of probes to the downside, which are quite rapidly being rejected," said Nicholas Frappell, global head of institutional markets at ABC Refinery.
"ADP data came in a little bit lower than the forecast, so that probably explains gold's rally as some people think that the data will be reflected in non-farm payrolls," said Frappell.
Meanwhile, Fed Chair Kevin Warsh said on Wednesday that inflation expectations and inflation risks have come down in recent weeks, even as he repeated the central bank is committed to bringing inflation down to its 2% goal.
Traders are pricing in roughly a 64% chance of a rate hike in September, according to the CME FedWatch Tool. FEDWATCH
June nonfarm payroll data, due at 1230 GMT, could shape expectations for the Fed's rate path.
Oil prices fell after Iran and the United States concluded a round of indirect talks on Wednesday, focused on the Strait of Hormuz, but made little headway toward a lasting peace.
Elevated oil prices can stoke fears over inflation, and while gold is traditionally seen as a hedge against inflation, it loses its appeal in a high interest-rate environment.
Spot silver rose 1.8% to $60.20 per ounce, platinum gained 2.3% to $1,613, and palladium added 1.5% to $1,228.18.
