EDITOR NOTE: According to last week’s U.S. jobs data report, the labor market is far from what economists had expected. And if you’ve been following the Fed’s comments on the matter of interest rates, it’s clear that as long as there’s slack in jobs, interest rates will continue to be suppressed, as wage inflation is the primary indicator that might signal the Fed to begin hiking interest rates. So, it’s no surprise that gold got a relatively strong boost and that the yellow metal has been rising since it double-bottomed in March and April, as it’s well known that job growth is central to the Fed’s policy decisions. Silver, palladium, and platinum also rose, as investors sought safety from the inflationary impact that sustained and ultra-low low-interest rates will have on the economy. How high might gold and other metals go? In another curation published today (and we highly recommend you read it), one expert weighs in, explaining the rationale behind the argument for gold at $50,000 an ounce. It all has to do with the revaluation of gold relative to the dollar--something that’s likely to take place given America’s $28 trillion debt, or, to put it bluntly, America’s “functional insolvency.”
Gold prices on Monday hovered close to a near three-month high hit last week after weaker-than-expected U.S. jobs data cemented hopes that interest rates will stay low for some time, pressuring the dollar and boosting bullion's appeal.
* Spot gold was up 0.1% at $1,831.72 per ounce by 0131 GMT, after hitting its highest since Feb. 11 at $1,842.91 in the previous session.
* U.S. gold futures were up 0.2% at $1,834.00 per ounce.
* The dollar index languished near a more than two-month low versus major peers, making gold less expensive for other currency holders.
* U.S. job growth unexpectedly slowed in April, likely curbed by shortages of workers and raw materials as rapidly improving public health and massive government aid fuelled an economic boom.
* The 266,000 jobs that U.S. firms added in April were "nowhere near" what was expected, a Federal Reserve official said on Friday, and added little to the "substantial further progress" officials want to see before considering changes to monetary policy.
* Lower interest rates decrease the opportunity cost of holding non-yielding bullion
* Stocks rose on Monday, while oil prices jumped after a cyber attack on a U.S. pipeline operator unnerved markets.
* Physical gold demand in India dived last week as shops shuttered and people turned cautious due to surging coronavirus infections across the world's second-largest bullion consumer.
* Speculators increased their bullish positions in COMEX gold and silver contracts in the week to May 4, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
* Palladium rose 0.3% to $2,934.58 per ounce. * Silver gained 0.8% to $27.65 per ounce, while platinum was up 0.6% at $1,256.47.
Original post from Reuters