XAU/USD drops below $2,650 as strong US payrolls boost dollar strength
Gold prices retreated sharply to $2,645 per ounce, falling 1.2% after the US Non-Farm Payrolls data exceeded expectations in May. The US economy added 272,000 jobs, significantly above the forecast of 185,000, while the unemployment rate held steady at 3.9%. This robust employment report reinforced expectations that the Federal Reserve might maintain higher interest rates for longer, supporting dollar strength. The US Dollar Index surged 0.8% to 105.40, creating headwinds for non-yielding gold. Technical indicators show XAU/USD broke below the key support at $2,650, with the next support level at $2,625. Resistance now stands at $2,670, coinciding with the 50-day moving average. Traders are closely monitoring upcoming CPI data and Fed commentary for further directional cues on monetary policy trajectory.
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