Gold down ahead of US jobs report

Gold futures on the COMEX division of the New York Mercantile Exchange fell Wednesday as traders prepared for the release of the U.S. jobs report Friday.

The most active gold contract for June delivery lost 8.9 U.S. dollars, or 0.72 percent, to settle at 1,228.60 dollars per ounce.

Gold was put under pressure ahead of the release of the big monthly U.S. jobs report Friday as a separate report released by the U.S.-based Automated Data Processing on Wednesday showed the private sector added more jobs than expected in March, suggestive of continued improvement in the U.S. labor market.

Ever since the March meeting of the Federal Open Market Committee (FOMC), traders believe that the Fed may raise rates from 0.50 to 0.75 during the June FOMC meeting. According to the CMEGroup's Fedwatch tool, the current implied probability of a hike from 0.50 to 0.75 is at 5 percent at the April 2016 meeting, and 26 percent at the June 2016 meeting.

The U.S. Dollar Index rose by 0.26 percent to 94.93 as of 1800 GMT. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

The precious metal was put under further pressure as the U.S. Dow Jones Industrial Average rose by 83 points, or 0.43 percent as of 1800 GMT. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

Silver for May delivery dropped 2.2 cents, or 0.14 percent, to close at 15.211 dollars per ounce. Platinum for July delivery fell 0.8 dollar, or 0.08 percent, to close at 966.20 dollars per ounce.