Solid Gold Futures – Global gold prices came under renewed pressure during Asian trading on Tuesday (Nov 3), falling below US$3,950 per troy ounce and erasing some of the gains made in the previous session. A strengthening US dollar and a rebound in US government bond yields were the primary factors weighing on XAU/USD.
Downward pressure intensified after US manufacturing activity outperformed expectations. The ISM Manufacturing PMI rose to 55.5 in October, up from 54.5 the previous month—surpassing market forecasts. The data indicates that business activity remains expansive, reinforcing the view that the US economy continues to be resilient.
A robust economic backdrop, combined with expectations that the Federal Reserve’s policy stance will remain relatively hawkish, helped the dollar recover some of its earlier losses. Rising Treasury yields also increased the opportunity cost of holding non-yielding assets like gold, dampening investor appetite for the precious metal.
Nevertheless, the dollar’s gains have been tempered by market caution ahead of the US midterm elections and ongoing diplomatic developments involving Iran. President Donald Trump stated that Iran is seeking a deal to end the conflict, while Iranian Foreign Minister Abbas Araqchi noted that consultations via mediators are highly intensive. However, these discussions have yet to yield a breakthrough, and global geopolitical risks remain elevated.
Market attention now shifts to the US JOLTS Job Openings data, due for release during the North American session. The primary focus for the week remains Friday’s Nonfarm Payrolls (NFP) report. Strong labor market data could bolster the dollar and exert further pressure on gold, whereas signs of a cooling labor market might provide room for an XAU/USD recovery. (srh)