Bearish traders took control of the gold market at the end of last week. Demand for the precious metal is likely to fall further in the upcoming days, pushing down the price of gold.
Over the last week, the asset decreased by 1.6%. Gold also lost 1.6% during Friday's session, with July gold futures falling by $30.30 to $1,923.70 per ounce.
The recent US labor market data, which was released on Friday, put downward pressure on the precious metal.
According to the latest report by the US Department of Labor, more than 430,000 new jobs were created in the US economy in March. Unemployment decreased to 3.6% from 3.8% in February.
Average hourly earnings increased by 0.4% month-over-month and 5.6% year-over-year.
Positive labor market data is likely to give further support to the Federal Reserve's aggressive plans to raise interest rates.
In March, the US central bank raised interest rates by 25 basis points to relieve inflationary pressure for the first time since 2018.
The Fed is now planning to hike the rate by 50 basis points at its next policy meetings, as the tense geopolitical situation amplifies inflationary risk.
Expectations of hawkish Fed policy drove the US dollar and benchmark US 10-year Treasury yields higher on Friday. USDX gained 0.3%, while the yield of 10-year Treasury bonds rose above 2.45%.
This week, investors are assessing the probability of further Fed monetary tightening following the rise in employment and earnings in March.
USDX and US Treasury bond yields advanced early on Monday, pushing gold down. At the time of writing, the precious metal declined by 0.3% or $5.8 to $1,917 per ounce.
Macroeconomic factors are more likely to affect gold's price dynamics in the upcoming few days than geopolitics, which fuelled the precious metal's rally since late February. The gold market is likely to remain in bearish territory this week.
Any signs of progress in peace talks between Moscow and Kyiv could be detrimental for the precious metal, removing the asset's support and sending it into a nosedive.
