Gold hits two-week high as US dollar firms

Gold prices edged down on Monday after hitting a two-week high in the previous session, weighed down by a slight rise in the dollar, as investors waited for more US economic data for clues on plans for Federal Reserve monetary policy.

Spot gold was down 0.1% to $ 1,785.41 an ounce at 12:37 GMT, after hitting its highest level since June 18 at $ 1,794.86 on Friday. US gold futures rose 0.1% to $ 1,785.20.

The dollar rose 0.1% against its rivals, making gold expensive for holders of other currencies.

American companies hired the most workers in 10 months in June, raising wages and providing incentives to attract millions of unemployed Americans to sit at home.

Stronger-than-expected U.S. jobs report boosts investor attention to economic data and the Fed’s next move, as markets welcome further evidence of a robust economic recovery amid concerns about persistent inflation.

Japan’s service sector activity contracted for the 17th consecutive month in June, as the coronavirus dampened domestic and foreign demand, underscoring the sluggish dynamics of the world’s third-largest economy.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell to 1,042.58 tonnes on Friday from 1,043.16 tonnes on Thursday.

Speculators reduced their net long positions in COMEX gold during the week ending June 29 and increased their net long positions in silver, according to data from the US Commodity Futures Trading Commission.

Gold in India last week was sold at a higher price for the first time in more than two months as demand gained ground after restrictions to tackle the second wave of the coronavirus were eased slightly.

Silver fell 0.2% to $ 26.40 an ounce, palladium gained 0.3% to $ 2,793.19 and platinum fell 0.3% to $ 1,086.49.