Gold Rises Most in Three Weeks as Payrolls Trail Estimate

Gold futures jumped the most in three weeks after a government report showing U.S. job growth was less than expected triggered economic concerns, boosting demand for the metal as a store of value.

Payrolls rose 192,000 in March, less than last month and trailing the median forecast for 200,000 in a Bloomberg survey of economists. Federal Reserve Chair Janet Yellen said this week that the economy will need monetary stimulus for “some time,” and that the central bank hasn’t done enough to cut unemployment. Last year, gold plunged the most since 1981, partly on speculation that the Fed would reduce bond purchases.

The payroll data “is below market consensus, and that’s supporting gold,” Michael Gayed, the chief investment strategist who helps oversee $250 million at New York-based Pension Partners LLC, said in a telephone interview. “This is a very crucial number that the Fed looks at.”

Gold futures for June delivery rose 1.5 percent to settle at $1,303.50 an ounce at 1:52 p.m. on the Comex in New York, the biggest gain for a most-active contract since March 12.

The metal jumped 70 percent from December 2008 to June 2011 as the central bank pumped more than $2 trillion into the financial system and cut interest rates to a record in a bid to boost the economy.

Haven Demand

This year, gold has climbed 8.4 percent as global economic growth faltered and Russia’s annexation of Crimea sparked the most-serious confrontation with the U.S. since the Cold War.

China’s demand may pick up after the slump from the six-month high of $1,392.60 on March 17, James Steel, a metal analyst at HSBC Securities Inc. in New York, said yesterday in a report. “This may help stem the potential for further losses.”

China is the world’s top gold consumer, followed by India.

India’s bullion imports more than doubled in March from February, according to a government official with direct knowledge of the matter. In China “we expect more pro-growth measures to come,” Zhu Haibin, an economist at JPMorgan Chase & Co., said yesterday in a report.

“Expectation of further stimulus in China and higher imports by India is also keeping gold well supported,” Gayed said.

A Bloomberg survey before the jobs data showed 32 traders and analysts were split on the price outlook.

South Africa

Platinum futures for July delivery rose 0.4 percent to $1,450.90 an ounce on the New York Mercantile Exchange. The price climbed for the sixth straight session, the longest rally since mid-February.

Holdings in exchange traded products backed by the metal rose 0.6 metric ton to a record 80.5 tons, data compiled by Bloomberg show.

The Association of Mineworkers and Construction Union led more than 70,000 workers on strike in South Africa since Jan. 23 at mines of the biggest platinum producers.

Palladium futures for June delivery rose 0.2 percent to $790.75 an ounce on the Nymex. The price rose for the sixth straight session, the longest rally in four weeks. The metal has advanced 10 percent this year, partly on Russian supply concerns.

Silver futures for May delivery gained 0.7 percent to $19.946 an ounce on the Comex.

To contact the reporter on this story: Debarati Roy in New York at droy5@bloomberg.net

To contact the editors responsible for this story: Millie Munshi at mmunshi@bloomberg.net Patrick McKiernan

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