Gold price slips ahead of U.S. jobs data, set for third weekly fall
London (Jun 5) Gold fell on Friday ahead of U.S. employment data that could bolster prospects for an interest rate increase this year and the precious metal was heading for its third straight weekly slide.
Traders awaited the key U.S. non-farm payrolls report due later in the day for more clues on the world's biggest economy and how it might impact the Federal Reserve's interest rate policy.
Spot gold was down 0.1 percent at $1,174.96 an ounce by 1133 GMT, within reach of a five-week low of $1,172.55 hit in the previous session. The metal was heading for a 1 percent fall on the week.
A break below technical support of $1,171 could trigger a decline to a March low of $1,143, ScotiaMocatta said in a note.
"Clearly the market is going to look at the U.S. data ... As long as the market is confident that the U.S. economy continues to grow after a weak first quarter, then there is this belief that the Fed is going to move forward as planned," Julius Baer analyst Carsten Menke said.
The non-farm payrolls data, seen as a key barometer of the U.S. economy, is forecast to have increased to 225,000 in May from 223,000 in April, according to a Reuters poll.
Strong data would keep the Fed on track to raise interest rates later this year, a move that could hit demand for non-interest-paying bullion.
Better-than-expected data this week has already taken its toll on bullion, with cautious investor positioning ahead of the jobs report further dragging on prices.
The dollar rose 0.2 percent versus a basket of currencies, while European shares fell after Greece delayed a debt payment to the International Monetary Fund due on Friday.
The delay came as German Chancellor Angela Merkel said talks on a cash-for-reforms deal were still far from reaching an agreement. Greek Prime Minister Alexis Tsipras demanded changes to tough terms from international creditors for aid to stave off default.
Trading in physical markets was bleak despite the lower prices. A tight price range and expectations of more declines, in a seasonally quiet period for bullion, kept consumers away from gold jewellery, bars and coins.
Premiums in major trading centres across Asia, the top consuming region, have barely moved in the past few weeks.
Spot platinum rose 0.2 percent to $1,099.50 an ounce. It was still trading at the cheapest to gold since January 2013, with a $90 an ounce discount to the yellow metal.
Silver rose 0.2 percent to $16.15 an ounce, while palladium edged 0.3 percent higher to $754.50 an ounce.
Source: Reuters
