Gold slides after solid jobs data; palladium crosses key $1,300 mark
Gold fell on Friday, pulling back from a more than six-month peak hit earlier in the session, as robust U.S. jobs data eased some concerns about an ailing economy, while palladium prices punched through the key $1,300 level for the first time.
The metal was however on track for a third straight weekly gain, up about 0.2 percent so far, mainly helped by recent strong gains. It touched its highest level since mid-June at $1,298.42 earlier in the day.
U.S. gold futures
"Industrial commodities and currencies have rebounded therefore the precious metals which have been the safe haven such as gold, silver have retraced today," said David Meger, director of metals trading at High Ridge Futures.
"That is exacerbated by a stronger-than-expected payrolls data."
Data showed U.S. employers hired the most workers in 10 months in December, suggesting a sustained strength in the economy that could soothe concerns of sharp slowdown in growth.
"Today`s U.S. jobs report throws more uncertainty into the direction of Federal Reserve monetary policy, which had already been seen as murky," Jim Wyckoff, senior analyst at Kitco Metals, wrote in a note.
Fed Chairman Jerome Powell on Friday moved to mollify financial markets concerned about a U.S. economic slowdown, saying that while momentum is solid, the central bank will be sensitive to the downside risks the market is pricing in.
Powell`s remarks sent investors into riskier assets like stocks, which rallied amid hopes of upcoming trade talks between United States and China, further pressuring bullion. [MKTS/GLOB]
"Mr. Powell said he is open to a potential view change but so long as the data stays strong in the U.S. we will continue to project hikes in the interest rates in the U.S. by the central bank," said Bart Melek, head of commodity strategies at TD Securities.
Gold is highly sensitive to rising interest rates, as these increase the opportunity cost of holding non-yielding bullion.
"Palladium has broken out to the upside on tight supply, increasing demand, a weaker dollar," said Phil Streible, senior commodities strategist at RJO Futures in Chicago.
"Platinum followed surprisingly as fresh fund money emerged for the new year as prices have been so depressed for so long," said Walter Pehowich, executive vice president of investment services at Dillon Gage Metals.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.