Gold Prices Held Mild Gains Ahead of Non-Farm Payrolls Data; Silver Prices Also Up
Gold prices held small gains during Asian trading hours on Friday as investors tentatively wait for the U.S. Labor Department’s monthly non-farm payrolls report, an economic indicator which will provide a fairly good idea over the longevity of the Federal Reserve’s ongoing quantitative easing or monthly $85 billion worth bond purchase program. Silver prices also edged higher in early trading on Friday.
The Federal Reserve’s quantitative easing, which is pegged to the improvement in the job improvement, has been the key driver for gold bull runs in last five years.
At last check, U.S. gold futures for June delivery inched up 0.12% to $1,554.20 an ounce while spot gold added 0.07% to $1,553.81 an ounce.
However, the yellow metal struggled year-to-date as vast improvement in the U.S. macroeconomic environment (barring this week’s unexpectedly week ADP the U.S. private sector job data and Labor Department’s weekly jobless claims data) along with absence of any inflationary pressure dented its inflation hedge and safe haven appeal.
In this backdrop, should non-farm payrolls data for March show some strength then investors’ sentiment in the metal will further dwindle. Besides, the Fed might be also prompted to halt its QE3 much sooner-than-expected.
“If the data turns out to be strong tonight from the U.S., investors will look to the stock markets as it appears more attractive,” said Brian Lan, managing director of GoldSilver Central, according to Reuters.
“Gold’s direction will really depend on the data released tonight,” added Lan.
The non-farm payrolls data is expected at 8:30 a.m. EST.
Meanwhile, GFMS, a consultancy firm focused on metals said that the gold market has started to show signs of entering bearish phase in 2014 as demand for Jewelry, coins and central bank purchases have eased significantly.
Silver futures gained 0.59% to $26.93 an ounce.
In pre-market trading, the iShares Silver Trust (ETF) (NYSE: SLV) was up 0.42%, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was up 1.09%.
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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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