MTECHTIPS;-Gold tumbles to 1-month low after strong ADP report

MTECHTIPS;-Gold tumbles to 1-month low after strong ADP report

MTECHTIPS- Gold prices slumped to a 1-month low on Wednesday, after a better-than-expected ADP jobs report lifted expectations of a March rate hike. Gold for April delivery on the Comex division of the New York Mercantile Exchange shed $6.75 or 0.54%, to trade at $1,209.55 a troy ounce. ADP and Moody’s analytics said Wednesday, employment in the private sector climbed by 298,000 for the month, which dwarfed economists’ expectations of 190,000 and underpinned expectations the Federal Reserve will hike rates at its meeting this month. The bullish ADP report came ahead of Friday’s non-farm payrolls for February, viewed as a critical barometer of the U.S. economy and represents the final key economic data point ahead of the Federal Reserve’s policy meeting on March 14-15. According to Investing.com’s Fed rate monitor tool, nearly 90% of traders expect a rate hike in March, compared to just 80% of traders on Monday. Gold is sensitive to moves in U.S. interest rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced. Gold has traded on the back foot since Fed Chair Janet Yellen signaled last Friday the U.S. central bank will hike rates in March, should inflation and jobs data remain on track.
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