PRECIOUS gold range tied as investors prepare for verdict on US jobs
B.and Arundhati Sarkar
October 8 (Reuters) – Gold barely changed on Friday as investors stayed on the sidelines waiting for confirmation of a strengthening US labor market that could keep the Federal Reserve on track to begin pulling back economic stimulus this year.
Spot gold XAU = rose 0.1% to $ 1,757.10 an ounce through 0905 GMT while US gold futures GCv1 fell 0.2% to $ 1,756.00.
Gold is already factoring in tapering and there is little propensity to take aggressive positions, especially given the non-farm payroll report on the horizon at 1230 GMT, StoneX analyst Rhona O’Connell said.
Fed chief Jerome Powell said it would take another report on “decent” jobs to kickstart the process to cut the US Federal Reserve’s monthly bond purchases by $ 120 billion.
If the data shoots up, gold could face a knee-jerk downward reaction as bond yields were likely to rise, but “failure would be supportive for gold as the word ‘stagflation’ ‘is increasingly on the radar and gold takes risk. Dislike. “
A Reuters poll forecast non-farm payrolls USPRP = ECI should have increased by 500,000 jobs in September.
However, some analysts see the outlook for gold on the downside as the Fed could raise interest rates anyway.
A firmer US dollar also seemed to have received little attention from investors .DXYmaking gold bars expensive to overseas buyers, as well as higher US Treasury bond yields. USD /US/US10YT = RR
Reduced incentives and higher interest rates increase bond yields, which translates into increased opportunity costs for holding gold bars that do not pay interest.
While gold as a safe haven will find some support from increased inflation, geopolitical tensions and rising cases of delta coronavirus, factors such as the Fed tightening, easing pandemic restrictions and strong growth will limit prices, Fitch Solutions said in one Communication dated October 7th.
Spot silver XAG = fell 0.4% to $ 22.49 an ounce.
platinum XPT = rose 1.1% to $ 990.41 an ounce and rose 2% over the course of the week.
palladium XPD = rose 1.9% to $ 1,997.47.
(Reporting by Arundhati Sarkar in Bengaluru; editing by Kevin Liffey)
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