Gold Prices Slip, Silver Prices also Down
Gold prices edged lower during Asian trading hours on Friday as market participants keenly wait for U.S nonfarm payrolls data for October, which could provide a good idea on the duration of Federal Reserve’s economy stimulating bond purchase program. Silver prices also edged lower in early trading on Friday.
At around 6:00 a.m. EST, spot gold fell 0.38% to $1,707.51 while U.S. gold futures for December delivery edged down 0.44% to $1,707.90 an ounce. According to Reuters market analyst Wang Tao, technical analysis suggested that spot bullion could fall as low as $1,698.39 an ounce on Friday.
The U.S. Labor Department is scheduled to release its monthly nonfarm payrolls data on Friday; and, according to Reuters’ poll, economists are expecting an uptick in hiring for the month of October even as unemployment level is anticipated to rise to 7.9%.
Earlier on Thursday the private sector employment data provided by the Automatic Data Processing (ADP) and the Labor Department’s weekly jobless initial jobless claims pointed towards marked improvement in the U.S. labor market. Besides, some other economic indicators turned out better-than-expected. Analysts fear that ongoing of barrage of improving economic indicators might press the Federal Reserve to cut short its bond purchase program or QE3.
Commenting over improving job market and its implication on gold’s prices, Nick Trevethan, senior commodity strategist at ANZ in Singapore said to Reuters, “If the nonfarm payrolls data is very good, it will be bearish for gold as it will cut expectations for any additional quantitative easing and it will be fairly positive for the dollar as well.”
Meanwhile, a firmer U.S. dollar also continued to weigh on gold prices. The ICE Dollar Index, a measure on US dollar’s performance against a basket of six major currencies, traded at 80.34 on Friday up from 80.08 on Thursday in late North American trading, putting pressure on dollar priced commodities.
Silver futures lost 0.66% to trade just over $32 an ounce.
In pre-market trading, the iShares Silver Trust (ETF) (NYSE: SLV) was down 0.96%, the ProShares Ultra Silvr (ETF) (NYSE: AGQ) was down 1.82%, and the ProShares UltraShort Silver (ETF) (NYSE: ZSL) was up 1.51%.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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