Gold rebounded from a 10-month low, gaining the most in five weeks, after U.S. payrolls grew by the least in nine months, boosting prospects that the Federal Reserve will take more steps to spur growth.
Payrolls increased by 88,000 workers in March, less than the most-pessimistic forecast in a Bloomberg survey, after a revised 268,000 February increase, Labor Department data showed. The jobless rate was 7.6 percent. The Federal Reserve last month left unchanged plans to hold its target interest rate near zero percent as long as U.S. unemployment remains above 6.5 percent. The central bank also said it will continue its $85 billion in monthly asset purchases.
“This number works very well for gold,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates, said in a telephone interview. “People will move back to gold as all whispers about quantitative easing ending prematurely will die down.”
Gold futures for June delivery added 1.5 percent to settle at $1,575.90 an ounce at 1:43 p.m. on the Comex in New York, the biggest gain since Feb. 26. Prices still slumped 1.2 percent this week.
The precious metal touched $1,539.40 yesterday, the lowest since May 30. Prices dropped 4.8 percent in the first quarter as improving U.S. economic growth spurred concern the Fed would trim its stimulus program.
Silver futures for May delivery gained 1.7 percent to $27.22 an ounce in New York, after reaching $26.575 yesterday, the lowest since July 24. Prices fell 3.9 percent this week and entered a bear market on April 1. The precious metal is down 9.9 percent this year.
On the New York Mercantile Exchange, platinum futures for July delivery jumped 1.2 percent to $1,535.50 an ounce. Palladium futures for June delivery slipped 0.2 percent to $723.90 an ounce. Prices fell 5.8 percent this week, the biggest decline since May.