Gold prices pared initial losses to edge higher during Asian trading hours on Friday and are headed to log weekly gains with bullion investors keeping their eyes on Labor Department’s monthly nonfarm payroll data since any weakness in number might boost metal’s safe haven appeal.
Stronger euro, which jumped to its 15 months high against the greenback in the wake of stabilizing financial markets in the monetary union and weaker-than-expected Chinese PMI data, provided some support to bullion on Friday.
At around 6:45 a.m. EST, gold futures for February delivery edged up 0.31% to $1,667.20 an ounce while spot gold gained 0.2% to $1,666.31 an ounce. Silver futures tacked higher 0.28% to $31.44 an ounce.
Lately metal prices are swinging wildly in either direction, taking direction from U.S. economic indicators. While gold futures climbed 1.1% on Wednesday after the Commerce Department’s data showed that U.S. economy shrank by 0.1% in fourth quarter, boosting metal’s safe haven appeal, it retracted 1.2% in the subsequent session as profit booking and failure to breach $1,680-$1,690 an ounce level triggered technical sell off.
Now, metal prices are likely to hinge on monthly non-farms payroll data, slated to be released later today. Any weakness in the job data could spur up investors to seek safety in safe haven bets such as gold. On the other hand, significant improvement in the numbers will tend to lure investors towards riskier assets. This is the reason why, bullion investors are treading with caution while those who had taken bullish positions are liquidating, taking advantage of slightest of gains.
According to Reuters’ survey, economists are expecting non farms payrolls to have risen by 160,000 in January from 155,000 in December.
“Investors are still trading on news, particularly from the United States,” said Brian Lan, managing director of GoldSilver Central in Singapore, according to Thomson Reuters.
“Precious metals haven’t gotten their safe haven status back fully yet,” added Lan.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.