Gold Declines as Drop in U.S. Jobless Rate Fuels Fed Rate Bets – Bloomberg

Gold futures fell to the lowest in two weeks as the U.S. unemployment rate dropped to a seven-year low, fueling speculation that the Federal Reserve will raise interest rates this month.

The jobless rate fell to 5.1 percent in August, the lowest since April 2008, a government report showed Friday. Average hourly earnings climbed more than forecast and workers put in a longer workweek. The Fed is weighing whether the economy is strong enough to tighten monetary policy, which would curb the appeal of gold because the metal doesn’t pay interest.

Bullion prices in August posted the first monthly gain since May as a retreat in global stocks and a devaluation in China’s currency fueled speculation that the Fed would hold off on raising interest rates this month. The Fed has signaled that it’s likely to raise rates this year for the first time since 2006 as the labor market improves.

“Employment headlines are back to pre-crisis levels, and that builds up the story of the U.S. recovery,” Alfonso Esparza, a senior currency analyst at OANDA in Toronto, said in a telephone interview. “If the Fed manages to get one rate hike in this year, that would be something to put downward pressure on gold.”

Gold futures for December delivery fell 0.3 percent to settle at $1,121.40 an ounce at 1:46 p.m. on the Comex in New York, after dropping to $1,115.70, the lowest since Aug. 19.

Holdings in exchange-traded products backed by gold fell 0.9 metric ton to 1,522.4 tons, according to data compiled by Bloomberg as of Thursday. Assets are near the lowest since 2009.

Silver futures for December delivery declined 1.1 percent to $14.549 an ounce on the Comex. On the New York Mercantile Exchange, platinum futures for October delivery slid 1.8 percent to $992.40, and palladium futures for December delivery dropped 0.8 percent to $577.15 an ounce.

Gold futures fell to the lowest in two weeks as the U.S. unemployment rate dropped to a seven-year low, fueling speculation that the Federal Reserve will raise interest rates this month.

The jobless rate fell to 5.1 percent in August, the lowest since April 2008, a government report showed Friday. Average hourly earnings climbed more than forecast and workers put in a longer workweek. The Fed is weighing whether the economy is strong enough to tighten monetary policy, which would curb the appeal of gold because the metal doesn’t pay interest.

Bullion prices in August posted the first monthly gain since May as a retreat in global stocks and a devaluation in China’s currency fueled speculation that the Fed would hold off on raising interest rates this month. The Fed has signaled that it’s likely to raise rates this year for the first time since 2006 as the labor market improves.

“Employment headlines are back to pre-crisis levels, and that builds up the story of the U.S. recovery,” Alfonso Esparza, a senior currency analyst at OANDA in Toronto, said in a telephone interview. “If the Fed manages to get one rate hike in this year, that would be something to put downward pressure on gold.”

Gold futures for December delivery fell 0.3 percent to settle at $1,121.40 an ounce at 1:46 p.m. on the Comex in New York, after dropping to $1,115.70, the lowest since Aug. 19.

Holdings in exchange-traded products backed by gold fell 0.9 metric ton to 1,522.4 tons, according to data compiled by Bloomberg as of Thursday. Assets are near the lowest since 2009.

Silver futures for December delivery declined 1.1 percent to $14.549 an ounce on the Comex. On the New York Mercantile Exchange, platinum futures for October delivery slid 1.8 percent to $992.40, and palladium futures for December delivery dropped 0.8 percent to $577.15 an ounce.

Gold futures fell to the lowest in two weeks as the U.S. unemployment rate dropped to a seven-year low, fueling speculation that the Federal Reserve will raise interest rates this month.

The jobless rate fell to 5.1 percent in August, the lowest since April 2008, a government report showed Friday. Average hourly earnings climbed more than forecast and workers put in a longer workweek. The Fed is weighing whether the economy is strong enough to tighten monetary policy, which would curb the appeal of gold because the metal doesn’t pay interest.

Bullion prices in August posted the first monthly gain since May as a retreat in global stocks and a devaluation in China’s currency fueled speculation that the Fed would hold off on raising interest rates this month. The Fed has signaled that it’s likely to raise rates this year for the first time since 2006 as the labor market improves.

“Employment headlines are back to pre-crisis levels, and that builds up the story of the U.S. recovery,” Alfonso Esparza, a senior currency analyst at OANDA in Toronto, said in a telephone interview. “If the Fed manages to get one rate hike in this year, that would be something to put downward pressure on gold.”

Gold futures for December delivery fell 0.3 percent to settle at $1,121.40 an ounce at 1:46 p.m. on the Comex in New York, after dropping to $1,115.70, the lowest since Aug. 19.

Holdings in exchange-traded products backed by gold fell 0.9 metric ton to 1,522.4 tons, according to data compiled by Bloomberg as of Thursday. Assets are near the lowest since 2009.

Silver futures for December delivery declined 1.1 percent to $14.549 an ounce on the Comex. On the New York Mercantile Exchange, platinum futures for October delivery slid 1.8 percent to $992.40, and palladium futures for December delivery dropped 0.8 percent to $577.15 an ounce.

Gold futures fell to the lowest in two weeks as the U.S. unemployment rate dropped to a seven-year low, fueling speculation that the Federal Reserve will raise interest rates this month.

The jobless rate fell to 5.1 percent in August, the lowest since April 2008, a government report showed Friday. Average hourly earnings climbed more than forecast and workers put in a longer workweek. The Fed is weighing whether the economy is strong enough to tighten monetary policy, which would curb the appeal of gold because the metal doesn’t pay interest.

Bullion prices in August posted the first monthly gain since May as a retreat in global stocks and a devaluation in China’s currency fueled speculation that the Fed would hold off on raising interest rates this month. The Fed has signaled that it’s likely to raise rates this year for the first time since 2006 as the labor market improves.

“Employment headlines are back to pre-crisis levels, and that builds up the story of the U.S. recovery,” Alfonso Esparza, a senior currency analyst at OANDA in Toronto, said in a telephone interview. “If the Fed manages to get one rate hike in this year, that would be something to put downward pressure on gold.”

Gold futures for December delivery fell 0.3 percent to settle at $1,121.40 an ounce at 1:46 p.m. on the Comex in New York, after dropping to $1,115.70, the lowest since Aug. 19.

Holdings in exchange-traded products backed by gold fell 0.9 metric ton to 1,522.4 tons, according to data compiled by Bloomberg as of Thursday. Assets are near the lowest since 2009.

Silver futures for December delivery declined 1.1 percent to $14.549 an ounce on the Comex. On the New York Mercantile Exchange, platinum futures for October delivery slid 1.8 percent to $992.40, and palladium futures for December delivery dropped 0.8 percent to $577.15 an ounce.