Gold Rises as China Returns; Focus on U.S. Jobs Report
February 7, 2014 7:08 PM EST
Gold edged higher on Friday as Chinese buyers came back into the market after a week-long holiday and was set to rise for a sixth week out of seven as global equities remained on edge over economic growth concerns.
A saleswoman arranges a gold necklace inside a jewellery showroom in the southern Indian city of Kochi. (Reuters)
Traders, however, were holding off on big bets until after the release of the U.S. nonfarm payrolls report later in the day, which could provide clues about the strength of the recovery.
Spot gold rose 0.4 percent to $1,261.65 an ounce by 0714 GMT. It has gained about 1.5 percent this week.
U.S. hiring likely snapped back from a three-year low in January and kept the unemployment rate steady at 6.7 percent, according to a Reuters poll of economists, but some warned that extremely cold weather could have had an impact.
"Like every other market, gold is waiting for the nonfarm payrolls for cues," said Victor Thianpiriya, an analyst with ANZ.
"If it is a bad report, the market will likely discount it as being a weather related issue like we saw in December. The initial reaction would be a spike in gold prices but that would be wound back in the ensuing days," he said.
After a mixed bag of economic data in recent days, markets are looking towards the jobs report on Friday to provide some clarity on the state of the economy.
The number of Americans filing new claims for unemployment benefits fell more than expected last week, data showed on Thursday, but other data showed a slump in U.S. exports in December.
Silver, tracking gold, is up 4 percent this week - its biggest weekly gain since mid-August.
Markets in China, the world's biggest gold consumer, opened on Friday after a week-long holiday for the Lunar New Year, boosting volumes that had thinned during Asian hours in the past few days.
They were about $4 last Thursday just before China before went on the holiday.
Trading volumes had reached 22.438 tonnes by 0713 GMT - the highest since January 6.