Gold futures were facing a sharp selloff Monday morning that saw the precious metal fall more than 5% at its low during Asian trading hours.
At last check, December gold
was trading off $20.40, or 1.2%, at $1,742.70 an ounce, but had touched an session low at $1,672.80 an ounce. The tumble comes after bullion fell 2.5% on Friday, and marked its steepest weekly slump, down nearly 3%, since the period ended June 18.
Monday’s drop briefly took gold futures to prices not seen since early June of 2020, according to FactSet data.
Silver futures for September delivery
meanwhile, also fell as much as 7% at $22.26 an ounce, but were recently down 2% at $23.83 an ounce. Gold’s sister metal on Friday put in its sharpest one-day drop since June 17, helping to log a weekly decline of about 4.8%.
There wasn’t an immediate catalyst for the session’s declines but strategists and other market participants attributed the sharp drop in trade in Asian hours to low volumes and persistent concerns about the prospect for precious metals after a better-than-expected U.S. jobs report on Friday.
“Gold sank sharply in the Asian session overnight as the momentum from Friday’s strong jobs report carried through the weekend and accelerated in an illiquid session with Japan and Singapore being closed for a holiday,” wrote Neil Wilson, analyst at Markets.com, in a daily note.
The employment report for July showed that the U.S. economy added 943,000 jobs, according to the Labor Department. Economists had forecast 845,000 jobs last month. Meanwhile, the unemployment rate dropped to 5.4%, below the estimate of 5.7% and falling below the 5.9% rate for June.