September 03, 2015
Gold Holds Loss as Investors Seek Fed Rate Clues From Jobs Data
(Bloomberg)- Gold held a decline before a U.S. government payrolls report on Friday which may offer clues on whether the economy is strong enough for an interest rate rise after private jobs data showed an increase in hiring.
Bullion for immediate delivery fell 0.1 percent to $1,133.38 an ounce at 12:18 p.m. in Singapore, according to Bloomberg generic pricing. The metal lost 0.6 percent on Wednesday, the first decrease in four days.
U.S. firms added more jobs in August than a month earlier, the ADP Research Institute said on Wednesday. Traders are focused on the nonfarm payrolls report for signals on the strength of the economy amid a global equity rout after China surprised markets by devaluing the yuan on Aug. 11. The Federal Reserve meets to discuss borrowing costs on Sept. 16-17.
“If the jobs data is very strong for the U.S. economy, it’s more likely that the Fed is going to decide to raise interest rates,” Bob Takai, chief executive officer and president of Sumitomo Corp. Global Research, said by phone from Tokyo. The Fed will also have to consider what’s happening in China and on global financial markets, Takai said. “It’s 50-50 in my view.”
Signs of resilient U.S. growth have supported speculation that Fed policy makers will raise rates this year. The Fed’s Beige Book released Wednesday indicated the economy expanded across most regions and industries in the past two months, based on reports gathered on or before Aug. 24.
Holdings in exchange-traded products backed by gold fell 6.9 metric tons on Tuesday to 1,522.7 tons, the biggest drop since July 31. Assets have shrunk 11 percent in the past year as some investors lost faith in the metal as a store of value.
Gold futures for December lost 0.1 percent to $1,132.70 on the Comex in New York. Silver for immediate delivery was little changed at $14.6975 an ounce. Platinum retreated 0.3 percent to $1,011.70 an ounce, while palladium dropped 0.7 percent to $580.50 an ounce.