LONDON: Gold prices rose yesterday, recovering from their lowest in nearly three months, after US payrolls data for August missed expectations, tempering speculation that US interest rates were set to rise sooner rather than later.
The metal hit its weakest since mid-June earlier yesterday and is on track to end the week lower, suffering after gains in stock markets. The European Central Bank’s surprise interest rate cut on Thursday further boosted the appeal of equities.
Spot gold was up 0.4 percent at $1,266.00 an ounce at 1402 GMT, while US gold futures for December delivery were up 60 cents an ounce at $1,267.10. The metal rose to a session’s high of $1,273.45 an ounce in the wake of the data, but quickly pared gains.
“Gold initially received a boost from the worse-than-expected job report on the dual assumption that it could dampen the prospect for higher interest rates and more importantly that it could help trigger some long liquidation of the dollar,” Saxo Bank’s head of commodity research Ole Hansen said.
US short-term interest rate futures contracts rose, leading traders to boost bets the Fed will not raise interest rates until the second half of 2015.
REUTERS
