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Gold Eases as Traders Wait for US Economic Data

Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. Reuters
Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. Reuters
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Gold Eases as Traders Wait for US Economic Data

Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. Reuters
Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. Reuters

Gold prices eased on Tuesday, while investors awaited a slew of US economic data to gauge the size of the Federal Reserve's expected interest rate cut this month.
Spot gold fell 0.2% at $2,495.50 per ounce by 0630 GMT. Prices hit a record high of $2,531.60 on Aug. 20.
US gold futures steadied at $2,527.50.
The dollar lingered near a two-week high, making bullion less appealing for other currency holders.
"Gold is unable to recapture levels around all-time highs due to lack of fresh positive catalysts. If we see U.S. data pointing to a weak economy and the Fed taking to the narrative of having a jumbo rate cut, gold will rally," said Kelvin Wong, OANDA's senior market analyst for Asia Pacific.
"Prices could go as high as $2,640 this year."
Market focus is on Friday's US August non-farm payrolls report. Economists surveyed by Reuters expect the addition of 165,000 US jobs.
ISM surveys, JOLTS job openings and ADP employment report are also on investors' radar.
Traders currently see a 31% chance of a 50-basis-point rate cut at the Fed's Sept. 17-18 policy meet and a 69% chance of a quarter-point cut.
Last week, data showed US consumer spending picked up in July, arguing against a 50-bp rate cut.
Gold "remains our preferred hedge against geopolitical and financial risks, with additional support from imminent Fed rate cuts and ongoing emerging market central bank buying. We open a long gold trade recommendation," Goldman Sachs said.
Bullion is considered a safe asset amid turmoil and tends to thrive in a low rate environment.
Spot gold may test support at $2,473, a break below that could open the way towards $2,434, according to Reuters technical analyst Wang Tao.
Spot silver dipped 0.5% to $28.35, platinum fell 1% to $921.05 and palladium lost 1% to $968.62.

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Oil Extends Decline on Surprise US Inventory Builds

FILE PHOTO: An oil and gas industry worker walks during operations of a drilling rig at Zhetybay field in the Mangystau region, Kazakhstan, November 13, 2023. REUTERS/Turar Kazangapov/File Photo
FILE PHOTO: An oil and gas industry worker walks during operations of a drilling rig at Zhetybay field in the Mangystau region, Kazakhstan, November 13, 2023. REUTERS/Turar Kazangapov/File Photo
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Oil Extends Decline on Surprise US Inventory Builds

FILE PHOTO: An oil and gas industry worker walks during operations of a drilling rig at Zhetybay field in the Mangystau region, Kazakhstan, November 13, 2023. REUTERS/Turar Kazangapov/File Photo
FILE PHOTO: An oil and gas industry worker walks during operations of a drilling rig at Zhetybay field in the Mangystau region, Kazakhstan, November 13, 2023. REUTERS/Turar Kazangapov/File Photo

Oil prices fell for a third straight session on Thursday as unexpected increases in US crude and fuel inventories raised concerns about demand from the world's largest oil consumer while investors eyed renewed Iran-US nuclear talks.

Brent futures edged 16 cents lower to $64.75 a barrel by 0630 GMT, while US West Texas Intermediate crude weakened 10 cents to $61.47.

Both benchmarks fell earlier in the session after US crude and fuel inventories posted surprise stock builds last week, the Energy Information Administration said on Wednesday, as crude imports hit a six-week high and gasoline and distillate demand slipped.

Crude inventories rose by 1.3 million barrels to 443.2 million barrels in the week ended May 16, the EIA said. Analysts in a Reuters poll had expected a 1.3 million-barrel drawdown.

"The EIA's reported surprise stock builds will have a downward pressure particularly on WTI," said Emril Jamil, a senior analyst at LSEG Oil Research. He added this could further incentivise more US exports to Europe and Asia.

Hiroyuki Kikukawa, chief strategist of Nissan Securities Investment, a unit of Nissan Securities, said: "While rising US inventories have raised concerns, some investors expect the summer driving season starting after Memorial Day weekend to draw down stocks, limiting further downside."

Both benchmarks lost 0.7% on Wednesday after Oman's foreign minister said the fifth round of nuclear talks between Iran and the United States will take place on Friday in Rome.

Prices had jumped earlier on Wednesday following a CNN report that US intelligence suggests Israel is preparing to strike Iranian nuclear facilities, although it was not clear whether Israeli leaders have made a final decision.

Iran is the third-largest producer among members of the Organization of the Petroleum Exporting Countries and an Israeli attack could upset supply from the country.

"Traders remain cautious, avoiding large positions as they assess conflicting signals over US-Iran nuclear talks and a media report of potential Israeli strikes on Iranian nuclear facilities," said Kikukawa.

Priyanka Sachdeva, senior market analyst at Phillip Nova, said: "Additionally, Ukraine suggested that it would seek harsher sanctions on Russia from the EU, which could further disrupt the flow of Russian oil barrels to global markets."

Ukraine will ask the EU next week to consider big new steps to isolate Moscow, according to a white paper, including seizing Russian assets and bringing in sanctions for some buyers of Russian oil.