The gold price drifted lower during Monday December 5 trading as its earlier push higher failed to hold and it slipped into negative territory.
The yellow metal had found support from its safe haven status after Italian Prime Minister Matteo Renzi was defeated in Sunday’s referendum.
“Despite the short-term advance the rest of the factors arrayed against gold look bearish,” INTL FCStone analyst Edward Meir said.
“The precious metal will struggle against a soaring dollar, rising interest rates and buoyant US equity markets. On the rate count, the December move by the Fed is largely a foregone conclusion, but gold bugs have to be concerned about future moves that could come along at a faster clip,” Meir said.
The US Federal Open Market Committee (FOMC) will meet on December 14 – many participants expect an interest-rate rise to be announced, particularly after a run of positive data from the USA.
On Friday non-farm payroll numbers showed that the USA added 178,000 jobs in November, against earlier expectations of around 165,000 and from October’s figure of just 161,000. In addition, unemployment dropped to 4.6% and wages climbed by 2.5%.
Source: The Bullion Desk