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Focus on Friday's release of U.S. employment data
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Gold up over 2% so far this week
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Silver, platinum set for fourth straight weekly gain
(Updates prices)
By Deep Kaushik Vakil
April 6 (Reuters) - Gold prices pared some gains on
Thursday ahead of a key U.S. jobs report, but bullion was still
on track for a weekly rise as weak U.S. economic data spurred
worries of a slowdown.
Spot gold was down 0.6% to $2,009.07 per ounce by
2:53 p.m. EDT (18:53 GMT), while U.S. gold futures for
June delivery settled 0.5% lower at $2,026.40.
Safe-haven bullion has risen more than 2% so far this week,
surpassing the key $2,000 level, as oil prices surged after the
shock OPEC+ output cuts, while data showed a slower U.S.
services sector and fewer job openings. The U.S. Federal Reserve is in a bind, as higher interest
rates could trigger a recession but a pause in the monetary
tightening risks embedding inflation, with either scenario
positive for gold, said Paul Wong, market strategist at Sprott.
"It is a long weekend for most major markets, so I would
expect low volume, not meaningful price action today."
Also supporting prices this week, the dollar index hovered around two-month lows, while benchmark Treasury yields hit a seven-month trough. Gold is seen as an inflation hedge but lower rates decrease the opportunity cost of holding zero-yield bullion.
The Fed should stick to raising interest rates to lower inflation while the labor market remains strong, St. Louis Fed President James Bullard said. However, more data reinforcing the need for rate cuts "could keep gold above $2,000 and perhaps propel it into uncharted territory," said Craig Erlam, senior market analyst at OANDA. Traders are awaiting the U.S. jobs report on Friday for cues, but their reaction will only become apparent next week due to the Good Friday market holiday. Spot silver fell 0.2% to $24.92 per ounce, while platinum rose 1% to $1,007.21. Both metals were set for their fourth consecutive weekly gains.
Palladium gained 2.3% to $1,463.10. (Reporting by Deep Vakil in Bengaluru; additional reporting by Seher Dareen in Bengaluru; Editing by Paul Simao and Rashmi Aich)
