Gold headed for the biggest weekly decline in almost seven months as investors looked to the U.S. nonfarm payrolls report Friday for signals on the strength of the economy, which will help determine when the Federal Reserve raises interest rates.
Bullion for immediate delivery retreated as much as 0.5 percent to $1,108.43 an ounce, the lowest since Sept. 16, and traded at $1,110.02 by 2:44 p.m. in Singapore, according to Bloomberg generic pricing. Prices fell 3.2 percent this week, the most since the five days ended March 6.
The jobs data will be scrutinized for signs of whether China’s slowdown and the steepest quarterly rout in global stocks since 2011 have shaken the U.S. recovery. The Labor Department report is projected to show payroll gains accelerated last month compared with August. Gold fell for five straight quarters through Sept. 30.
“This payrolls could cement the October-December argument for the Fed,” Victor Thianpiriya, a Singapore-based analyst at Australia & New Zealand Banking Group Ltd., said in an e-mail. “If it’s well above expectations I think the market will seriously start to consider October.”
Traders are pricing in a 44 percent chance the Fed will move in December and odds of 18 percent in October, according to data compiled by Bloomberg. Holdings in exchange-traded funds backed by gold rose 1.9 metric tons to 1,532.06 tons as of Thursday, the highest since July 30, data compiled by Bloomberg show.
Platinum fell 5.1 percent this week, the most since October 2014, while palladium headed for a fourth weekly advance, the longest rising streak since July 2014.