Gold was little changed above $1,750 early Monday as investors awaited a decision on the Federal Reserve’s tapering timetable.
U.S. benchmark 10-year Treasury yields touched the highest level since early June last week, making the yellow metal less attractive as an alternate investment. The dollar index was flat.
The key U.S. nonfarm payrolls report for September — which came out Friday — widely missed economists’ expectations. That would typically make gold a desirable investment as a hedge against uncertainty. But investors are more closely watching economic data as indicators of the Fed’s plans on the pace of the taper and the eventual increase in interest rates. That has kept gold mostly rangebound. Fed policymakers meet in early November.
December gold futures lost $1 last week to settle at $1,757.40 an ounce on Comex after the front-month contract decreased $1.80 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 7.3% so far in 2021. The December contract is currently down $2.90 (-0.17%) an ounce to $1,754.50 and the DG spot price is $1,756.50.
Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.2% Friday to 985.05 metric tons, Reuters reported.
The U.S. added 194,000 jobs last month, according to Friday’s Labor Department report, far below economists’ estimates of 500,000. Fed Chairman Jerome Powell said last month that if the jobs report was “decent,” then policymakers would be likely to begin tapering pandemic stimulus measures as soon as November.
Jobs reports are key indicators of the state of the economy as rising inflation has pressured central bankers to remove stimulus measures and boost low interest rates. In contrast to the monthly report, the weekly initial jobless claims report that came out Thursday showed applications for unemployment benefits declined more than expected.
Goldman Sachs cut its U.S. growth forecasts for 2021 and 2022 in a report issued Sunday, saying it expects a “delayed recovery in consumer spending.” A team of economists led by Jan Hatzius said the investment bank now expects the economy to expand 5.6% in 2021 instead of 5.7%. The bank lowered its outlook for next year to 4% growth from 4.4%.
December silver futures increased 0.8% last week to settle at $22.71 an ounce on Comex. The front-month contract gained 0.2% Friday. Silver retreated 8.2% in September, its fourth consecutive monthly decline, and plummeted 16% in the third quarter. The metal is down 14% so far this year. Silver prices are tied to industrial demand. The December contract is currently down $0.035 (-0.15%) an ounce to $22.670 and the DG spot price is $22.72.
Spot platinum rose 4.9% last week to $1,031.30 an ounce and advanced 4% Friday. The metal lost 5.3% last month and 10% last quarter. It’s down 3.9% so far this year. Currently, the DG spot price is flat at $1,036.00.
Spot palladium increased 8% last week to $2,096.00 an ounce and rose 5.5% Friday. It lost 23% in September, 31% in the third quarter and is down 14% so far in 2021. The DG spot price is keeping last week’s rally afloat. It is currently up $65.50 an ounce to $2,168.50.
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