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• Gold prices inched down on Monday after robust U.S. jobs data late last week potentially increased the chances of more U.S. interest rate hikes this year.

Spot gold had dipped 0.2 percent to $1,330.60 per ounce by 0257 GMT.

Spot gold on Friday declined 1.2 percent, its biggest one-day fall since Dec. 7. Last week, the metal saw its largest weekly decline since the week-ending Dec. 8.

U.S. gold futures were down 0.3 percent at $1,333.30 per ounce.

• Non-farm payrolls rose by 200,000 jobs in January, the U.S. Labor Department said, beating expectations of 180,000 and their largest annual gain in more than 8-1/2 years. Average hourly earnings rose and boosted the year-on-year increase to 2.9 percent, the largest rise since June 2009.

• “We have a bearish outlook for gold ... and yield-chasing behaviour and a rosy economic outlook should pressure the yellow metal lower,” said OCBC analyst Barnabas Gan.

“The higher interest rate environment will actually fuel further risk-taking and is not good for gold.”

• Futures markets reacted on Friday after the jobs data by pricing in the risk of three, or even more, rate rises from the U.S. Federal Reserve this year.

The Fed last week held interest rates unchanged, but raised its inflation outlook and flagged “further gradual” rate increases.

• Asian share markets stumbled on Monday as fears of resurgent inflation battered bonds, toppled Wall Street from record highs and sparked speculation central banks globally might be forced to tighten more aggressively.

“The fall in stocks has just started and it could just be a short-term correction before running higher. We should not read too much in to the fall in stocks and relate it to gold,” Gan said.

• Meanwhile, hedge funds and money managers raised their net long position in COMEX gold contracts in the week to Jan. 30 to their highest level since late-September, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.

• Spot silver climbed 0.6 percent to $16.69. Earlier, it touched $16.54, matching more than one-month lows hit on Friday.

Silver fell 3.7 percent on Friday to its worst one-day decline since Dec. 15, 2016. It also saw its worst week since week-ending July 7, falling 4.6 percent last week.

Platinum rose 0.2 percent to $987.95, after touching more than two week low at $982 on Friday.

Palladium fell 0.5 percent to $1,041.50.

• The gold rise since mid-December has coincided with the US dollar’s freefall that began just after the Fed raised interest rates for the fifth time since the rate-hike cycle began in December of 2015. If, in fact, the U.S. dollar does break below the critical support level at 88.50 and quickly falls down to the 85 area, we could easily see gold prices gain 2 to 3% which would take the spot price to just about $1400 per ounce.

Reference: Reuters