National Bank of Poland likely to stand pat in October, inflation to remain above 2.5 pct target until end-2020
Gold eases as dollar nears 1-week peak on better-than-expected economic data
Gold prices edged lower, extending previous session losses as the U.S. dollar surged, although worries over the global economic outlook due to rising Covid-19 cases limited downside.
Spot gold was trading 0.4 percent lower at $1,935.36 per ounce by 0726 GMT, having hit a high of $1992.56 on Tuesday, its highest since August 19. U.S. gold futures tumbled 0.2 percent to $1,940.40. On Wednesday, the metal declined 1.4 percent to close at $1,942.88.
The dollar index rallied to a near 1-week peak after the Federal Reserve said U.S. business activity and employment gained momentum through late August, but economic growth was generally sluggish as Covid-19 hotspots hampered reopening efforts.
Data released yesterday showed U.S. private employers hired fewer workers than expected for a second straight month in August, suggesting that the labor market recovery was slowing. Meanwhile, separate report showed factory orders rose more than expected in July, indicating continued improvement in the manufacturing sector.
Risk sentiment also improved on data showing a sustained recovery in China's service sector and the prospect of additional U.S. stimulus, boosting Asian equities higher. The recovery in China's service sector activity extended into a fourth straight month in August, as companies hired more people for the first time since January. China’s Caixin Services PMI rose to 54.00 versus 50.4 expected and 54.1 prior during the month of August.
According to a Reuters tally, more than 25.88 million people have been reported to be infected by the novel coronavirus globally and 857,881 have died. U.S.-China tensions and U.S. presidential elections also provided some support to the safe-haven metal.
The greenback against a basket of currencies traded 0.3 percent up at 92.92, having touched a low of 91.75 on Tuesday, its lowest since April 2018. The U.S. Treasury yields steadied, with the benchmark 10-year note yield trading at 0.661 percent.
Market participants now await the initial U.S. jobless claims report due later in the day, as well as U.S. payroll figures on Friday, for further insights on the health of the labour market.