Gold Falls for Weekly Loss, US Bullion Coins Start July Strong

NEW YORK (July 7) Precious metals plunged Friday, turning what would have been gains into weekly losses that totaled 0.9% for gold, 3.8% for silver and 1% for platinum.

Gold for August delivery sank $39.20, or 3.1%, to settle at $1,212.70 an ounce on the Comex in New York. Commodities tumbled Friday as the U.S. dollar surged to a near three-year high after U.S. jobs data exceeded expectations.

"A better jobs report means there’s less flight to safety," Brian Booth, a senior market strategist at Long Leaf Trading Group in Chicago, said in a telephone interview that was relayed on Bloomberg News. "The initial reaction to the report was a push higher in the dollar and a rise in stocks, and for as long as that continues, gold will struggle."

The U.S. economy added 195,000 jobs in June, the Labor Department reported, which was 30,000-40,000 higher than prior forecasts readily found on news sites.

Surveys on Gold Expectations for Next Week

The previous round of gold surveys leaned slightly bullish for prices this week. New surveys were mixed to a bit bullish for gold prices next week.

"Eighteen participants took part in this week’s (Kitco) survey, with seven seeing prices up, seven seeing prices down and four looking for sideways consolidation,"

"Many of those looking for further weakness cited continuing expectations for tapering of the Federal Reserve’s bond-buying program… Those looking for sideways to higher trade suggest the market has already factored in much of expected FOMC tapering and may be overextended to the downside, at least in the short term."

Bloomberg News noted that its latest survey had 14 participants expecting higher gold prices for the second week of July. Ten were bearish and 3 were neutral.