Gold Seen Cutting Weekly Drop as Slump Prompts Purchases
Gold futures jumped most in more than a week after a report showed the U.S. jobless rate unexpectedly increased to a five-month high.
Unemployment advanced to 8.3 percent in July, the Labor Department said today. The rate was forecast to hold at 8.2 percent, according to the median in a Bloomberg survey. The jobless number climbed even as the U.S. payrolls gained more than forecast last month, the report showed. Higher joblessness may spur the Federal Reserve to boost stimulus measures in a bid to buoy growth, raising the prospect of higher inflation.
“Traders think that the Fed is watching the unemployment rate very closely, and that will determine the timing of the stimulus,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “Some people may move to gold before the Fed makes an announcement.”
Gold futures for December delivery increased 1.2 percent to settle at $1,609.30 an ounce at 1:58 p.m. on the Comex in New York, the biggest gain since July 25. The metal ended the week down 0.8 percent, after as the European Central Bank and the Fed refrained from announcing new stimulus measures.
Bullion surged 70 percent from the end of December 2008 to June 2011 as the Fed kept borrowing costs at a record low and bought $2.3 trillion of debt in two rounds of so-called quantitative easing.
Silver futures for September delivery jumped 3 percent to $27.810 an ounce in New York, the biggest rise since June 29.
On the New York Mercantile Exchange, platinum futures for October delivery climbed 1.9 percent to $1,414.40 an ounce. Palladium futures for September delivery rose 1.8 percent to $578.20 an ounce.
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