Gold Dips On Inflation Concerns, Rate-hike Bets

(RTTNews) - Gold prices were moving lower on Monday, with rising U.S. bond yields and escalating Middle East tensions weighing on the precious metal's safe-haven appeal.

Spot gold dipped half a percent to $4,409.85 after a tumultuous week. U.S. gold futures were down half a percent at 4,455.51 an ounce.

The U.S. dollar index was subdued as the Japanese yen surged to a seven-month high, driven by increased bets on a faster pace of Bank of Japan tightening.

Long-dated global government bond yields reached new highs today as the release of much stronger-than-expected U.S. jobs data boosted the odds of a September rate hike by the Federal Reserve.

Data showed nonfarm payrolls rose by 162,000 jobs last month after an upwardly revised 21,000 jobs in July. Economists had forecast an increase of 55,000 jobs compared to the loss of 23,000 jobs originally reported for the previous month.

Market attention is currently focused on critical U.S. inflation data due this week, which could heavily influence the Fed's rate trajectory and investors' appetite for risk.

U.S. producer price inflation data is due on Thursday while the consumer price inflation report is scheduled for Friday.

Meanwhile, rising oil prices on escalating Middle East tensions fueled expectations that the European Central Bank will hike interest rates later this week.

Brent crude futures rose toward $97 a barrel as U.S. attacks on Iranian tankers and Tehran's threat of a new restricted zone outside the Strait of Hormuz raised concerns about prolonged disruptions to energy flows through the waterway.