Oil And Gold Analysis: Gold Futures Rose During Asian Trade

CL
Oil prices fell on Monday in reaction to weekend reports that Iran agreed on a multilateral plan that would curb Tehran's nuclear ambitions in a deal that could end sanctions on the Middle East country and allow it to resume exports and add to global supply. Talks among the U.S., Russia, China, Britain, Germany, France and Iran ended in agreement on a six-month deal that will limit advancements in Iran's nuclear program in exchange for easing economic sanctions against Tehran starting Jan. 20. In November, Iran pledged to eliminate its stocks of 20% enriched uranium within six months and limit the enrichment of uranium to 5%. Trade sanctions slapped on Iran due to its alleged nuclear ambitions have taken out more than 1 million barrels of oil per day from the global market over the past two years. Soft U.S. jobs numbers released Friday also pressured prices lower. The Bureau of Labor Statistics on Friday reported that the U.S. economy added 74,000 jobs in December, well below expectations for a 196,000 increase and below an upwardly revised 241,000 rise the previous month. The report also showed that the U.S. unemployment rate fell to 6.7% in December due to a weak participation rate, down from 7.0% in November. Analysts had expected the rate to remain unchanged last month.


GOLD
Gold futures rose during Asian trade on Tuesday as investors weighed the prospects for the Federal Reserve to scale down its bond-buying program at a more gradual pace after the U.S. economy added fewer jobs than expected in December. Gold futures gain during Asian trade as market digests U.S. jobs data On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,253.40 a troy ounce during Asian trading, up 0.06%. Fed asset purchases tend to weaken the dollar by suppressing long-term interest rates, thus making gold an attractive hedge. Gold saw added demand ahead of Tuesday's release of U.S. retail sales, with concerns that a disappointing figure just day after a poor jobs report will increase the chances of a more gradual Fed tapering. Capping gold's gains were sentiments among many that the December jobs report may be an anomaly and the product of bad winter weather that put off hiring.