Gold Eases Ahead of Jobs Reports

Gold Eases Ahead of Jobs Reports

Gold eases a tad ahead of jobs reports, but is sticking above $1,750 an ounce, as investors awaited the release of key jobs data for September for further direction. The yellow metal briefly hit a one-week high of $1,765 in early Monday trading, getting support from inflation fears.

The dollar slipped amid indications that the Federal Reserve may be inching closer to an increase in interest rates, which were left low to bolster the economy during the pandemic. The retreat in the U.S. currency — which traded at its highest level for 2021 last week — makes gold more attractive as an alternative investment.

December gold futures rose 0.4% last week to settle at $1,758.40 an ounce on Comex after the front-month contract increased $1.40 Friday. Gold retreated 3.4% in September after gaining just 90 cents in August. It dropped $14.60 in the third quarter. The yellow metal is down 7.2% so far in 2021. The December contract is currently down $6.30 (-0.36%) an ounce to $1,752.10 and the DG spot price is $1,752.00.

Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, slipped 0.4% Friday to 986.54 metric tons, Reuters reported. Speculators cut their net long positions in gold by 19,471 contracts to 42,123 contracts in the week ended Sept. 28, according to the weekly Commitments of Traders report published Friday by the U.S. Commodity Futures Trading Commission.

Key U.S. labor data due out at the end of the week will likely drive investor sentiment on economic growth and the timing of the Fed’s plans to taper stimulus measures and, eventually, raise interest rates to combat high inflation. Gold is a traditional hedge against inflation.

The monthly jobs report from the U.S. Labor Department is due out Friday, with weekly initial jobless claims scheduled for release Thursday. But the ADP employment report will likely give the first glimpse of the state of the job market in September when it comes out Wednesday.

On Friday, a closely watched gauge of U.S. manufacturing showed it expanded in September at the fastest pace in four months because of demand for factory goods and increasing inventories. The Institute for Supply Management’s measure of factory activity increased to 61.1 last month — beating expectations — from 59.9 in September. Figures over 50 indicate expansion.

Investors will also be watching the status of the global pandemic and U.S. President Joe Biden’s infrastructure bill.

December silver futures increased 0.5% last week to settle at $22.54 an ounce on Comex after the front-month contract rallied 2.2% Friday. Silver retreated 8.2% in September, its fourth consecutive monthly decline, and plummeted 16% in the third quarter. The metal is down 15% so far this year. Silver prices are tied to industrial demand. The December contract is currently down $0.136 (-0.60%) an ounce to $22.400 and the DG spot price is $22.50.

Spot platinum slid 0.7% last week to $983.30 an ounce, though it gained 1.2% Friday. The metal lost 5.3% last month and 10% last quarter. It’s down 8.4% so far this year. Currently, the DG spot price is down $24.70 an ounce to $959.90.

Spot palladium decreased 2.1% last week to $1,940.50 an ounce, though it advanced 1% Friday. It lost 23% in September, 31% in the third quarter and is down 21% so far in 2021. The DG spot price is currently down $13.70 an ounce to $1,922.00.


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