Gold slipped on Monday, May 7, snapping three days of gains as the dollar index rose back towards its
2018 peak and last week’s soft U.S. jobs data did little to dampen optimism about the world’s largest economy.
That left traders betting the Federal Reserve would press 0n with lifting U.S. interest rates this year. Higher rates typically weigh on gold, as they increase the opportunity cost of holding non-yielding assets such as bullion.
Spot gold was down 0.2 percent at $1,312.03 an ounce by 1135 GMT, while U.S. gold futures for June delivery
were 0.2 percent lower at $1,312.70.
The market was thinned by a national holiday in Britain, which closed trading desks in London.
Commerzbank analyst Carsten Fritsch said gold was still primarily driven by the dollar, and the widening interest rate differential between the United States and Europe. “This all boosts the U.S. dollar and weighs on gold,” he said.
Investors were therefore tempering bets on higher gold prices, he said, adding speculators had cut their net long positions to the lowest since July 2017 with a “massive reduction” in the last few trading weeks.
“Most speculative investors have thrown in the towel already,” he said.
Speculators cut their net long positions in COMEX gold by 62,378 contracts to 51,985 contracts in the week to May 1, data from the U.S. Commodity Futures Trading Commission (CFTC) showed on Friday.
Holdings of the world’s largest gold-backed exchange-traded fund, New York-based SPDR Gold Shares , fell 0.17 percent to 864.13 tonnes on Friday.
Meanwhile silver was down 0.3 percent at $16.43 an ounce, while palladium was 0.7 percent higher at $973.90. Platinum was up 0.7 percent at $911.90 an ounce, having earlier hit its highest since April 25 at $918.70.
On platinum, Societe Generale said money managers increased their short positions by 8,813 contracts, taking their short positions as a percentage of total open interest to 41.9 percent, the highest level since July 2017.
