Gold Price Steadies As U.S. Election Jitters Offset Solid U.S. Data
New York (Nov 4) Gold steadied on Friday, headingfor its biggest weekly rise since mid-September as jitters over next week's U.S. election offset a solid payrolls report thatshored up expectations for a U.S. interest rate hike next month.The dollar gained and U.S. stock markets were set to openslightly higher, outper forming losses for counterparts in Europeand Asia, after the upbeat U.S. jobs data added to the case fo ra December rise in interest rates.
That would weigh on non-yielding gold. However, an initialdip in the metal was quickly bought as investors remained on edge ahead of Tuesday's election.
Spot gold was at $1,303.83 an ounce at 1315 GMT, offa low of $1,295.71 in the immediate wake of the payrolls data but little changed from $1,303.25 on Thursday. U.S. gold futuresfor December delivery were up 0.1 percent at $1,303.40."The payrolls data is not (positive) enough to drive price sin a particular direction," ING's head of commodity strategy Hamza Khan said. "It's all going to be about the election on Tuesday. A Trump win would signal a positive direction for gold,so that's the bigger thing to watch."The dollar index was still on track for its biggest weekly drop since mid-August after the Federal Bureau ofInvestigation said last week it was re-opening a probe intoDemocrat candidate Hillary Clinton's use of a private emailserver while Secretary of State.
The FBI announcement on Friday narrowed Clinton's lead over her Republican rival Donald Trump, polls showed, rattlin gfinancial markets which had been pricing in a Clinton victory. That helped send gold to a one-month high on Thursday, and has put it on track to rise 2 percent this week.
"Gold implied volatility rallied sharply across the curveover the past week, as investors rotated to safe haven asset safter polls tightened," Citi said in a note. "As the electionkeeps driving gold prices in the short-term, we expect gold volume to remain elevated into Election Day."Gold prices in India swung to a discount this week as arally in prices dampened retail demand and prompted jewellers toreduce purchases, while buying in leading consumer China rose due to safe-haven buying.
Investor appetite looked firm, with the world's largest goldexchange-traded fund announcing a 4.4-tonne rise in its holdings on Thursday.
Silver was up 0.3 percent at $18.38 an ounce, on track to post its third consecutive weekly rise. Platinum was up 0.9 percent at $1,002.20 an ounce, while palladium was 0.6 percent higher at $619.70.
Source: Reuters
