MW: Gold falls as jobs report not as bad as feared
Gold futures fell slightly Friday, extending their weekly losses to more than 2%, after news of more massive job losses in March failed to dent this week's optimism over a global economic recovery, which has curbed demand for safe assets.
The U.S. economy lost 663,000 jobs in March, fewer than the 688,000 that analysts surveyed by MarketWatch had expected. Meanwhile, unemployment rate rose to 8.5%, in line with expectations.
Gold for April delivery fell $1.60, or 0.2%, to $905.80 an ounce in early morning session in North American electronic trading. The more active June contract fell 0.3% to $905.80.
Investors were "factoring in the idea that the [jobs] numbers are not as bad as expected," said Jon Nadler, senior analysts at Kitco Bullion Dealers. People were also expecting the Group of 20 nations meeting will "pull the economy out of its downward economic spiral."
Though the monthly job number came better than expected, total job losses were still ugly. The U.S. economy lost 5.1 million jobs since the recession began. January's revised job loss of 741,000 was the worst since 1949. In February, 651,000 jobs were lost. See full story.
Gold's decline on Friday came after its losses in the previous session. The metal fell 2% Thursday amid optimism about the G20 meeting.
Adding to the bearish gold tone, the G20 nations said it endorses 403 tons of gold sales by the International Monetary Fund. The proceeds will be used to provide finance for the poorest countries over the next two to three years. See full story on IMF gold sales.
Investment flowing into gold exchange-traded funds also stalled. Holdings in SPDR Gold Shares , the biggest gold ETF, stood at 1,127.44 tons Thursday, unchanged for a fifth session, according to the latest data from the fund.
But some analysts remained bullish on gold over the long term. In a report released earlier this week, analysts at Morgan Stanley said they expect gold prices to rise owing largely to continued uncertainty in the global financial system and long-term inflation risks.
"The risk of sustained quantitative easing ... will be long-term bullish for the gold market," they said in the report.
In other metals trading Friday, silver for May delivery fell 1.5% to $12.81 an ounce. June palladium added 0.1% to $223 an ounce, while April platinum rose 0.7% to $1,167.10 an ounce.
May copper rose 0.5% to $1.899 a pound.
