Gold Heads for Second Weekly Advance as Focus Turns to U.S. Jobs

  • Metal is up in four out of the five sessions this week
  • Exchange-traded holdings rose 5.5 tons to 2,031.2 tons

Gold headed for a second weekly advance as investors focus on a key jobs report in the U.S. due Friday after the Bank of England introduced a new stimulus package the previous day including its first interest-rate cut in seven years.

Bullion for immediate delivery was little changed at $1,361.57 an ounce at 11:03 a.m. in London, after a 0.2 percent gain on Thursday, according to Bloomberg generic pricing. The metal is up 0.8 percent this week.

The payrolls data will be watched for clues on the timing for the next rate increase by the Federal Open Market Committee. The BOE’s stimulus announced on Thursday to contain the fallout from the U.K. decision to quit the European Union was the latest measure from central banks and governments to support growth. Weak or negative interest rates have helped push gold 28 percent higher this year.

“Gold is up partly on the Bank of England’s meeting yesterday, where greater stimulus proved supportive,” said Simona Gambarini, a commodities economist at Capital Economics Ltd. in London. “The jobs data today will give a clue on future U.S. rates. We’re expecting one increase this year.”

Policy makers will hold off raising rates for at least a year, according to fed funds futures data compiled by Bloomberg, while the probability of a hike in December is about 37 percent, down from 45 percent two weeks ago.

In ETFs and other metals:

  • Holdings in gold-backed exchange-traded funds added 5.5 metric tons to 2,031.2 tons on Thursday, data compiled by Bloomberg show. That’s the highest level since July 2013.
  • Silver fell and platinum advanced in London.
  • Palladium headed for its first weekly drop since June.
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