Investing.com - Gold futures ended Friday’s session at the lowest level in two months, as the U.S. dollar rallied following the release of better-than-forecast U.S. non-farm payrolls data.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery tumbled 2.2% on Friday to settle at USD1,677.95 a troy ounce.
Earlier in the session, gold prices fell to a daily low of USD1,674.75 a troy ounce, the cheapest level since August 31. On the week, gold futures declined 2%, the fourth consecutive weekly drop.
Gold’s losses accelerated after prices broke below key support levels close to the USD1,690-level, triggering fresh sell orders amid bearish chart signals.
Gold prices were likely to find support at USD1,646.45 a troy ounce, the low from August 31 and resistance at USD1,727.25, the high from October 31.
Gold prices came under heavy selling pressure after the U.S. Department of Labor said the U.S. economy added 171,000 jobs in October, beating forecasts for an increase of 125,000.
The unemployment rate ticked up to 7.9% from 7.8% in September as more people re-entered the labor force.
The upbeat jobs data reinforced the view the U.S. economy is improving, raising concern the Federal Reserve might scale back its monetary easing measures to support growth.
The Fed vowed in mid-September to buy USD40 billion in mortgage securities each month until the economy improves in a third round of what is known as quantitative easing, or QE3.
Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would pump more money into the financial system.
The dollar also found support amid uncertainty over the outcome of Tuesday’s U.S. presidential elections, with opinion polls indicating a dead heat between President Barack Obama and Republican challenger Mitt Romney.
Investors are concerned over the U.S. fiscal cliff, approximately USD600 billion in tax hikes and spending cuts due to come into effect on January 1, which could threaten U.S. and global growth.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, rose 0.65% Friday to settle the week at 80.65, the highest level since September 7.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Meanwhile, market players continued to eye developments surrounding Spain, amid ongoing uncertainty over whether the debt-strapped country is moving closer to formally requesting a bailout from its euro zone partners.
A bailout would allow the European Central Bank to step in and buy Spanish sovereign debt, which would result in reduced borrowing costs for the debt-strapped nation. But Spain has been reluctant to do so because it may come with conditions on its budget.
Concerns over political uncertainty in Greece and doubts over whether the country will meet austerity targets also weighed on sentiment.
In the week ahead, investors will be anticipating the outcome of Tuesday’s U.S. presidential elections and looking ahead to policy meetings by the Bank of England and the European Central Bank on Thursday.
In addition, market participants will be awaiting any further developments in the handling of the debt crisis in the euro zone.
Elsewhere on the Comex, silver for December delivery plunged 4.1% on Friday to settle the week at USD30.92 a troy ounce. Earlier in the session, silver futures fell to USD30.81 a troy ounce, the lowest level since August 31.
On the week, silver futures retreated 3.65%.
Meanwhile, copper for December delivery dropped 1.95% Friday to close the week at USD3.483 a pound. Earlier in the session, prices touched USD3.473 a pound, the lowest since September 5.
Copper prices lost 2.1% on the week, the fourth consecutive weekly decline.
The industrial metal has been under heavy selling pressure in recent weeks, as increasing concerns over the outlook for global economic growth and the impact on future demand prospects dampened the appeal of the commodity.
Copper traders were looking ahead to a flurry of Chinese economic data later in the week, including reports on inflation and industrial production, to gauge whether the world second largest economy is heading towards a hard or a soft landing.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery tumbled 2.2% on Friday to settle at USD1,677.95 a troy ounce.
Earlier in the session, gold prices fell to a daily low of USD1,674.75 a troy ounce, the cheapest level since August 31. On the week, gold futures declined 2%, the fourth consecutive weekly drop.
Gold’s losses accelerated after prices broke below key support levels close to the USD1,690-level, triggering fresh sell orders amid bearish chart signals.
Gold prices were likely to find support at USD1,646.45 a troy ounce, the low from August 31 and resistance at USD1,727.25, the high from October 31.
Gold prices came under heavy selling pressure after the U.S. Department of Labor said the U.S. economy added 171,000 jobs in October, beating forecasts for an increase of 125,000.
The unemployment rate ticked up to 7.9% from 7.8% in September as more people re-entered the labor force.
The upbeat jobs data reinforced the view the U.S. economy is improving, raising concern the Federal Reserve might scale back its monetary easing measures to support growth.
The Fed vowed in mid-September to buy USD40 billion in mortgage securities each month until the economy improves in a third round of what is known as quantitative easing, or QE3.
Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would pump more money into the financial system.
The dollar also found support amid uncertainty over the outcome of Tuesday’s U.S. presidential elections, with opinion polls indicating a dead heat between President Barack Obama and Republican challenger Mitt Romney.
Investors are concerned over the U.S. fiscal cliff, approximately USD600 billion in tax hikes and spending cuts due to come into effect on January 1, which could threaten U.S. and global growth.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, rose 0.65% Friday to settle the week at 80.65, the highest level since September 7.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Meanwhile, market players continued to eye developments surrounding Spain, amid ongoing uncertainty over whether the debt-strapped country is moving closer to formally requesting a bailout from its euro zone partners.
A bailout would allow the European Central Bank to step in and buy Spanish sovereign debt, which would result in reduced borrowing costs for the debt-strapped nation. But Spain has been reluctant to do so because it may come with conditions on its budget.
Concerns over political uncertainty in Greece and doubts over whether the country will meet austerity targets also weighed on sentiment.
In the week ahead, investors will be anticipating the outcome of Tuesday’s U.S. presidential elections and looking ahead to policy meetings by the Bank of England and the European Central Bank on Thursday.
In addition, market participants will be awaiting any further developments in the handling of the debt crisis in the euro zone.
Elsewhere on the Comex, silver for December delivery plunged 4.1% on Friday to settle the week at USD30.92 a troy ounce. Earlier in the session, silver futures fell to USD30.81 a troy ounce, the lowest level since August 31.
On the week, silver futures retreated 3.65%.
Meanwhile, copper for December delivery dropped 1.95% Friday to close the week at USD3.483 a pound. Earlier in the session, prices touched USD3.473 a pound, the lowest since September 5.
Copper prices lost 2.1% on the week, the fourth consecutive weekly decline.
The industrial metal has been under heavy selling pressure in recent weeks, as increasing concerns over the outlook for global economic growth and the impact on future demand prospects dampened the appeal of the commodity.
Copper traders were looking ahead to a flurry of Chinese economic data later in the week, including reports on inflation and industrial production, to gauge whether the world second largest economy is heading towards a hard or a soft landing.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.