Gold traded little changed after a six-day losing run that sent prices to a near-three-week low as data showed U.S. service industries grew faster than forecast, boosting the case for the Federal Reserve to pare stimulus.
Bullion for immediate delivery was at $1,311.77 an ounce at 8:18 a.m. in Singapore from $1,311.81 yesterday, when bullion retreated to $1,305.98, the lowest level since Oct. 17. The run of six losses was the worst streak since May.
Gold lost 22 percent this year amid speculation the Fed would curb its $85 billion in monthly bond purchases as growth picked up. The Institute for Supply Management’s U.S. non-manufacturing index rose to 55.4 in October from 54.4 the prior month, data yesterday showed. Reports on U.S. gross domestic product and payrolls are due Nov. 7 and Nov. 8 respectively.
“Given the recent string of better-than-expected U.S. economic data, gold may test the $1,300 an ounce level ahead of the payrolls report,” James Steel, an analyst at HSBC Securities (USA) Inc., wrote in a note. “The path of least resistance for gold appears lower.”
GDP grew at a 2 percent annualized rate in the third quarter after a 2.5 percent pace from April to June, according to economists surveyed by Bloomberg before Commerce Department figures. Payrolls probably rose by 120,000 last month after a 148,000 gain in September, Labor Department data may show.
Gold for December delivery rose as much as 0.4 percent to $1,312.70 an ounce on the Comex in New York and traded at $1,311.80. The contract dropped to $1,305.20 yesterday, the lowest level for the most-active contract since Oct. 17.
Silver for immediate delivery was little changed at $21.684 an ounce after gaining and losing at least 0.2 percent. Palladium rose 0.4 percent to $752.30 an ounce, while platinum was little changed at $1,452.25 an ounce.
The Association of Mineworkers and Construction Union, the biggest union in South Africa’s platinum mines, has rejected pay offers exceeding the 6 percent inflation rate, raising the possibility of strikes. Lonmin Plc, Impala Platinum Holdings Ltd. and Anglo American Platinum Ltd., or Amplats, are in wage negotiations with the union.
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