Precious Metals Market Report by Bill Musgrave – American Gold Exchange
Gold slid 1.4% to close just over $1,190 after a surprisingly strong jobs report triggered speculation that the Fed may raise interest rates sooner than expected. Despite the pullback, gold finished the week 1.3% higher.
U.S. nonfarm payrolls added 321,000 jobs in November, the most in nearly three years and far more than forecast, while unemployment rate stayed unchanged at 5.8%. Wages rose by 0.4% in November after months of near-stagnation, suggesting that higher inflation may soon follow.
The dollar surged behind the jobs data as traders placed bets on higher U.S. interest rates. The ICE dollar Index, which measures the buck against a basket of major rivals, jumped more than 0.8% to its highest level in more than eight years. A rising dollar pressures god and other commodities denominated in it for international trade by making them more expensive to holders of other currencies.
Solid physical buying continues to support gold prices in Asia, the Middle East, and the U.S. Turkey’s gold imports jumped to 46.9 tonnes last month, the most in six years, and its silver imports reached a 2014 high. Higher demand in China is elevating premiums on gold bullion. The U.S. Mint sold 60,000 ounces of Gold Eagles in November, 25% more than a year ago. Mint sales have averaged 62,000 ounces per month for the past three months—an 80% increase over the previous three months.
The other precious metals were mixed on the day and week. Silver surrendered 1.9% but finished the week with an impressive 4.4% gain. Platinum lost 2.1% today but added 0.7% this week. Palladium added around 0.1% today but lost 1.3% this week.
At the Comex close: February gold dropped $17.30 to $1,190.40; March silver surrendered 32 cents to $16.26; January platinum lost $26.40 to $1,219.50; and March palladium picked up 55 cents, to $802.70 an ounce.