Gold Near 11 Month High, ADP Jobs Report Anticipated
Posted by Adam King on October 03, 2012
Gold gained in early trading on Wednesday as prices ranged just below 11 month
highs in anticipation of a U.S. employment report that will give investors an indication of
the recovery in the world’s largest economy.
The spot price of gold gained 0.3 percent to $1,778.50 per troy ounce by mid-
morning. Trading has been affected by China, the largest commodity consumer in the
world, which has been on a weeklong holiday.
Earlier this week, gold prices hit $1,794.40 per troy ounce, the prices in the
market since last November. U.S. gold futures for December delivery, the most-actively
traded product gained 0.3 percent to $1,781.00 per troy ounce.
Ross Norman, chief executive at gold-broking firm Sharps Pixley, said gold has
experienced a spring in its step at the end of the summer break. He sees good physical
buying coming through and central bank buying as firm, lending support to the market.
The dollar also firmed in currency market, measured against a basket of other
currencies. A stronger dollar typically weighs on commodities that are priced in dollars
as it takes fewer to match the commodity, but gold has managed to hold near its highest
levels in the year. Broadly, this is an indication of the strength of the precious metal in
current markets.
Recently reported data from China and Australia displayed greater weakness
in the major economies than had been anticipated and spurred expectations for further
action from central banks that would likely include accommodative monetary policy,
according to Reuters.
The U.S. ADP report on private sector employment, expected for release later in
the day on Wednesday, has the potential to affect the gold price, according to analysts,
particularly after the Federal Reserve said last month that its $40 billion per month bond-
buying program would only stop when a sustained improvement in the job market could
be measured.
Additionally, the U.S. government on Friday will release a broader study of
employment, which is expected to report 113,000 workers added to non-farm payrolls in
September after the 96,000 non-farm payrolls added in August.
Categories:
US Gold Market
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