Gold price retreats ahead of U.S. payrolls data

New York (Apr 6)  Gold retreated on Friday ahead of U.S. payrolls data, being closely watched for its implications for interest rate policy, though concerns over a China-U.S. trade standoff kept prices underpinned.

The metal rose in Asian trading after U.S. President Donald Trump reignited trade war fears by proposing $100 billion in new tariffs on China, but could not maintain those gains as caution set in before the payrolls report.

Spot gold was at $1,323.34 an ounce at 1133 GMT, down 0.2 percent and off an earlier high of $1,333.28. U.S. gold futures for June delivery were 0.1 percent lower at $1,326.60. "The key to gold's direction remains the dollar, and we expect the dollar to recover a bit more," ABN Amro analyst Georgette Boele said.
    The payrolls data and the U.S.-China trade dispute had the
potential to drive a move, she said, though for the time being
gold and the dollar were rangebound.
    The dollar was on track for a second week of gains as
investors cut bets against the currency ahead of the monthly
U.S. payrolls figures due at 1230 GMT.            
    The report is expected to show U.S. job growth slowed in
March, a Reuters poll showed. Analysts are closely watching wage
growth, with a faster-than-expected rise expected to boost bets
on more U.S. rate hikes than currently forecast.
    Gold prices were little changed for the week, having risen
on Monday on concerns over the prospect of a China-U.S. trade
war, before dropping to a one-week low on Thursday after both
countries signalled a willingness to negotiate.            
    However, Trump late on Thursday said he had instructed U.S.
trade officials to consider $100 billion in additional tariffs
on China, fuelling an already heated dispute between the world's
two biggest economies.            
    A holiday in China kept trading volumes thin.
    Holdings of the SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, rose 0.24 percent to 854.09
tonnes on Thursday.         
    Among other precious metals, silver was down 0.3
percent at $16.30 an ounce, while platinum was 0.1
percent lower at $909 an ounce.
    Palladium was up 0.4 percent at $908.90 an ounce,
after 10 successive sessions of losses. The autocatalyst metal
is still on track to end the week down nearly 5 percent.
    "Last year's uptrend has reversed and palladium prices are
down more than 20 percent from their January high," Julius Baer
said in a note. "We see them better aligned with a softer global
car market and shift our view to neutral."

REuters