Gold rebounds above two-month low on North Korean concerns
Gold bounced up from a two-month low on Friday, on concerns stoked by a Russian report that North Korea is preparing to test a long-range missile and on support from the U.S. dollar`s shift into negative territory.
"The Russian report of a looming North Korean missile test that could reach the west coast of the United States combined with a weakening dollar goosed gold from two-month lows," said Tai Wong, head of base and precious metals trading at BMO Capital Markets in New York.
"Gold has slumped 7 percent over the past month, which is making speculative shorts wary at current levels so we may see $1,300 before $1,250."
The dollar index <.dxy> fell from a 2-1/2-month high.[USD/]
"The dollar`s initial gains evaporated as market participants made a more sober assessment of the jobs report and realized that the sharp rise in average hourly earnings may have been driven by a sizeable drop in low-paid and hurricane-hit jobs rather than an actual rise in earnings," said Fawad Razaqzada, technical analyst for Forex.com.
"As the dollar fell, buck-denominated precious metals went up in value."
Earlier, bullion fell to a two-month low at $1,260.16 an ounce on an upbeat reading of the U.S. unemployment rate and wage growth last month that supported expectations for a further U.S. interest rate hike in December. This pushed the dollar and Treasury yields higher. [FRX/]
Gold prices have fallen 0.5 percent this week and are facing their fourth straight week of decline, the metal`s longest run of weekly losses this year.
Holdings of the world`s largest gold-backed exchange-traded fund, SPDR Gold Shares
Demand for physical gold in India improved slightly this week because of a correction in local prices, but restrictions on the industry and increased smuggling took the sheen off the bullion market. [GOL/AS]
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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