Gold prices moved higher in the early morning US trading period despite increased expectations of a normalisation of US interest rates. Gold for December delivery on the Comex division of the New York Mercantile Exchange was last up 80 cents or 0.7 percent at $1,094.90 per ounce. Trade has ranged from $1,089.0 to $1,097.90. On Friday, June US unemployment showed 215,000 added jobs, slightly below the forecast of 220,000. The unemployment rate was steady at 5.3 percent with wages seeing a modest gain of 0.2 percent. The figure is one the last major economic indiactors as the Federal Open Market Committee (FOMC) has become increasingly hawkish in recent weeks. A rate rise is now seen as the consensus action with the CME Group Fedwatch – a futures contract that is used to express the market’s view of the likelihood of a interest rate rise – now reading at a 54 percent probability. Earlier in the month, the probability fell to zero and has idled in the low double digits before the release of the labour data. A rate rise would be a boost for the dollar and conversely weigh on the precious metal’s complex, but in the interim gold has maintained strength and refuses to break support at $1,075 per ounce. “[Gold] has thus managed to defy the sound US labour-market figures, which make a Fed rate hike in September more likely,� Commerzbank said. “Our economists still envisage a first move at the Fed’s next meeting in September.� Additonally, bulls returned after piling out of gold the past two months with net long fund position (NLFP) in gold increasing by 5,435 contracts (or 19 percent) to 29,900 from 24,465 contracts in the week ending August 4, according to the latest CFTC statistics. The increase in the net length for the first time in six weeks was mainly driven by short-covering (-3,620 contracts) that was further reinforced by long accumulation (+1,815 contracts). The net length is down about 74 percent in the year to date. In global data and news, Japan was mixed with bank lending rising 2.6 percent, the economy watchers sentiment was better than the previous month, but consumer confidence edged lower. Meanwhile in Europe, the EU Sentix investor confidence index was 18.4, lower than forecast. Still to come are the US labour market conditions index, plus FOMC members Stanley Fischer and Dennis Lockhart are speaking. Turning to wider markets, Germany’s DAX and France’s CAC-40 were each up 0.6 percent, while the euro was 0.1 percent weaker at 1.0953 against the dollar. As for other precious metals, Comex Silver for September settlement rose 6.4 cents to $14.885 per ounce. Trade has ranged from $14.705 to $14.930. Platinum for October delivery was last up $11.90 to $974.10 per ounce, while the most actively traded palladium contract was at $598.85, up $1.95.

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