Gold prices weakened slightly on Monday (August 4th) as investors took profits after a sharp rise in the previous session on weaker-than-expected US employment data, which raised expectations of a US Federal Reserve interest rate cut in September.

Spot gold prices fell 0.1% to $3,360.62 per ounce, as of 04:32 GMT. Bullion prices rose more than 2% on Friday. However, US gold futures rose 0.4% to $3,412.80.

"Gold started the week conservatively after Friday's price surge. A combination of profit-taking and a stabilizing dollar has led to a slight weakening of gold at the start of the week," said Tim Waterer, chief market analyst at KCM Trade.

Last week, nonfarm payrolls rose by 73,000 last month, following a downwardly revised 14,000 gain in June, according to the Labor Department's Bureau of Labor Statistics. This revived hopes for a Fed rate cut in September, with the market now pricing in an 81% chance, according to the CME FedWatch tool.

The tariffs imposed by US President Donald Trump last week on several countries are likely to remain in place rather than be reduced as part of ongoing negotiations, Trade Representative Jamieson Greer said on CBS's "Face the Nation," which aired Sunday.

"But with Trump rekindling the tariff war, and a weak US jobs report increasing the likelihood that we'll see an FOMC rate cut in September, the decline in precious metals prices could be shallow," Greer said.

Gold, traditionally considered a safe haven asset during times of political and economic uncertainty, tends to strengthen in a low-interest rate environment.

Citi raised its three-month gold price forecast to $3,500 per ounce from $3,300, and its expected trading range to $3,300–$3,600 from $3,100–$3,500, citing concerns that the near-term outlook for US growth and inflation has worsened.

Spot silver rose 0.2% to $37.10 per ounce, platinum fell 0.6% to $1,307.52, and palladium fell 0.6% to $1,201.44. (alg)

Source: Reuters