BLBG:Gold Seen Cutting Weekly Drop As Slump Prompts Purchases
Gold was seen gaining for the first time in five days in London on speculation investors will step up purchases after the metal’s worst week in six.
Bullion fell to $1,584.08 an ounce today, the lowest price since July 25, after the European Central Bank failed yesterday to deliver immediate measures to stimulate a slowing economy. The Federal Reserve refrained from boosting monetary stimulus at a two-day meeting that ended on Aug. 1, while indicating a sluggish economy may prompt further steps to boost growth. Data today may show the U.S. jobless rate held above 8 percent.
“We’re inclined to think that given the growing friendliness to gold of late, that the dips will prove to be relatively more shallow, with investors more inclined than before to pick up gold sub $1,600,” Edel Tully, an analyst at UBS AG in London, wrote today in a report. “Today, the spotlight turns towards U.S. employment.”
Immediate-delivery bullion rose 0.3 percent to $1,593.75 an ounce by 9:21 a.m. in London. Prices are down 1.8 percent this week, the most since June 22. December-delivery futures were 0.4 percent higher at $1,596.60 on the Comex in New York.
Prices reached a five-week high of $1,629.35 in London on July 27 after ECB President Mario Draghi pledged to do whatever it takes to preserve the euro. Holdings in exchange-traded products expanded for a third day yesterday, climbing 1 metric ton to 2,397.2 tons, data compiled by Bloomberg show.
U.S. nonfarm payrolls probably increased by 100,000 last month, while the unemployment rate remained unchanged at 8.2 percent, economists surveyed by Bloomberg expect a Labor Department report to show today. The jobless rate has stayed above 8 percent for 41 straight months.
Silver for immediate delivery gained 0.4 percent to $27.25 an ounce. Palladium rose 0.5 percent to $573.80 an ounce. Platinum was 0.3 percent higher at $1,393.75 an ounce.
To contact the reporter on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
