Gold slipped in early U.S. trading Monday as a firmer dollar and an easing oil-risk premium outweighed support from softer labor data. Traders now wait on Wednesday’s FOMC minutes to settle a rate outlook that the June payrolls miss has already reshaped.
A stronger dollar dragged gold lower to start the week, even as soft jobs data and lingering Middle East risk kept a floor under the metal. Spot gold traded near $4,139.80 an ounce, down 0.82%, while spot silver changed hands at $61.660, down 0.98% on the session. The dollar recovered modestly after recent losses, with DXY around 101.035.
Payrolls miss reshapes rate bets
The market is still trading in the aftermath of last month’s FOMC meeting, where policymakers held the federal funds target range at 3.50% to 3.75%. That statement kept an inflation-first bias, noting that inflation remained above the 2% target and that energy-related supply shocks were still feeding prices.
Since then, softer jobs data has pulled down near-term hike expectations. Nonfarm payrolls rose by 57,000 in June, the unemployment rate fell to 4.2% and the labor force shrank by 720,000. As a result, the July hike probability fell to roughly 22% from 31.5% before the jobs report, while September odds also eased. Rhona O’Connell, head of market analysis for EMEA and Asia at StoneX, noted that swaps were pricing a 34% chance of a Q4 hike. According to Kitco, she described the U.S. labor market as “a mixed bag.”
Hormuz risk eases as OPEC+ adds barrels
The conflict in the Middle East and the uncertainty around the Strait of Hormuz has shifted from acute shock to managed risk, but not to normal. Oil slipped Monday after OPEC+ said seven members would raise output by 188,000 barrels per day in August, while shipping through Hormuz continued to recover. Brent traded near $71.72 a barrel and WTI near $68.40, well below wartime stress levels.
Yet the risk premium has not disappeared. Talks with Iran are on hold during funeral ceremonies for Ayatollah Ali Khamenei, and O’Connell noted that some tankers were moving through the strait while harassment and mine-risk warnings persisted. For gold, that leaves a background safe-haven bid but not a dominant driver.
FOMC minutes the next test
Traders are watching Fed Governor Christopher Waller’s remarks in Rome and services PMI prints before the larger event. Wednesday’s FOMC minutes at 2 p.m. ET will be read against the June payroll miss and the Fed’s still-hawkish inflation language. On the charts, first support for spot gold sits at $4,130.70 and then at $4,069.54, with resistance seen at $4,203.30.
Source: Kitco
Trading involves risk.
Risk Disclaimer
