- Gold on track for third consecutive weekly fall
- U.S. non-farm payrolls post largest gain in 1-1/2 years
(Recasts after U.S. jobs data, updates prices)
LONDON, March 9 – Gold prices fell on Friday after
strong U.S. jobs data increased the likelihood of interest rate
rises and as the potential for easing tensions with North Korea
sapped safe-haven demand.
Data showed U.S. job growth surged in February, recording
its biggest increase in more than 1-1/2 years, though a slowdown
in wage gains pointed to only a gradual increase in inflation
this year.
“The strong headline payrolls numbers suggest the Fed may do
a little more. I think there’s certainly no risk they’re going
to do less than three (rate increases),” said Steven Ricchiuto,
chief economist at Mizuho Securities USA in New York.
Spot gold was down 0.5 percent at $1,316.81 an ounce
by 1450 GMT and on track for a third consecutive weekly decline.
U.S. gold futures for April delivery fell 0.4 percent to
$1,316.50.
“We expect four U.S. rate hikes this year and this should
really be something that supports the dollar and causes gold
weakness,” said Norbert Rucker, head of commodity research at
Julius Baer in Zurich.
Julius Baer expects gold to fall to $1,225 in three months,
he added.
The dollar edged up against a basket of currencies ,
making gold more expensive for buyers using other currencies.
Gold was also pressured by news that U.S. President Donald
Trump agreed to meet North Korea’s Kim Jong Un in what would be
the first face-to-face encounter between the countries’ leaders
and could mark a breakthrough in a stand-off over the North’s
nuclear weapons.
“If, with this news, the tension with North Korea is easing,
it’s something that is, maybe not headwinds, but a mild breeze
against gold,” Rucker said.
The reaction has been muted because gold had failed to show
strong safe-haven demand last year during months of insults
exchanged over the North’s nuclear and missile programmes, he
added.
In other precious metals, silver slipped 0.5 percent
to $16.41 an ounce, platinum eased by 0.5 percent to $947
and palladium was up 0.3 percent at $979.20.
“Platinum is now closing in on a projection at $941/$932,
also the trend line from 2014 and the short-term down channel.
This should contain near-term downside,” said Stephanie Aymes,
head of technical analysis at Societe Generale.
Source: Reuters
