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Gold Futures Slumps by $19
World Economy

Gold Futures Slumps by $19

Gold futures were poised on Friday to suffer from their lowest settlement of the year, with prices feeling pressure from a rally in the US dollar after data showed the US economy added an unexpectedly strong 295,000 jobs in February.
Gold for April delivery on Comex dropped $19.20, or 1.6%, to $1,177 an ounce on Comex. For the week, prices based on the most-active contracts, were ready to log a 2.8% loss.
May silver lost more than 25 cents, or 1.6%, to $15.91 an ounce. For the week, it was down 4%.
 “A very strong US dollar mixed with low inflation expectations and policy makers intent on stimulating economic growth create circumstances where gold as a store of value seems near obsolete,” said Jonathan Citrin, founder and executive chairman of CitrinGroup.
The Labor Department said Friday that nonfarm payrolls rose by 295,000 in February, topping forecasts for a rise of 238,000. The unemployment rate fell to 5.5% from 5.7%, but wage growth remained subdued. January payrolls were revised down to show a 239,000 gain, versus an initial estimate of 257,000.
After the report, the US ICE dollar index  jumped after the report, with the data reinforcing expectations the Federal Reserve will move this summer to begin hiking interest rates. A stronger dollar makes commodities that are priced in the currency more expensive to users of other currencies.
Analysts note, however, that gold continues to rise in euro terms as the shared currency plumbs 12-year lows ahead of the European Central Bank’s Monday launch of its quantitative-easing program. Other metals on Comex traded lower as well. April platinum traded at $1,164.20 an ounce, down $15.90, or 1.4% — trading 1.8% lower on the week, while June palladium fell $5.35, or 0.7%, to $819.70 an ounce, up a modest 0.1% for the week. May copper declined by 3.2 cents, or 1.2%, to $2.62 a pound, trading 2.7% lower for the week.

 

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