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PRECIOUS-Gold at 4-month low as U.S. jobs rise makes rate hike likely
July 7, 2017 / 10:53 AM / a month ago

PRECIOUS-Gold at 4-month low as U.S. jobs rise makes rate hike likely

    * Gold touches weakest level since March 15
    * Silver hits 15-month low, palladium weakest since June 2
    * U.S. non-farm payrolls jump by 222,000 jobs

 (Updates prices, milestone; adds comment, byline, NEW YORK
dateline)
    By Marcy Nicholson and Eric Onstad
    NEW YORK/LONDON, July 7 (Reuters) - Gold fell to the lowest
in nearly four months on Friday after stronger than expected
United States jobs data increased the likelihood of another U.S.
interest rate increase and the dollar rose.
    U.S. non farm payrolls jumped by 222,000 jobs last month,
the Labor Department said, beating expectations of a 179,000
gain.             
    "We have a stellar U.S. jobs number," said Naeem Aslam,
chief market analyst at Think Markets.
    "The data has brought negative news for gold traders as
there isn't really anything in this number which is going to put
the brakes on an interest rate hike." 
    Spot gold        was down 1.2 percent at $1,209.90 an ounce
by 2:21 p.m. EDT (1821 GMT), after touching $1,207.15, the
weakest since March 15. It has dropped about 2.5 percent this
week and is set for its biggest weekly fall since the week of
May 5.
    U.S. gold futures         for August delivery settled down
1.1 percent at $1,209.70.
    Gold has shed about 6 percent since touching a seven-month
peak of $1,295.97 on June 6. 
    The dollar index        was firmer, making gold more
expensive for buyers outside the United States.      
    Dollar-denominated bullion typically loses value when the
greenback and interest rates rise as it does not pay interest.
    "Gold crumpled past May lows, unable to survive a dual
assault from a strong payrolls headline and silver plunging
through 2016 lows," said Tai Wong, director of base and precious
metals trading for BMO Capital Markets.
    "Recent hawkish central bank rhetoric led by a likely rate
hike from the Bank of Canada next week has offset mild inflation
data and geopolitical concern, may see gold test $1,200 short
term."
    Silver        fell 3.2 percent to $15.49 per ounce, after
falling 7 percent within one minute of trade to $14.86 an ounce,
its lowest in 15 months. Traders said the move appeared to have
been driven by an accidental order. The metal was on track to
close the week down more than 6 percent.
    Palladium        fell 0.4 percent to $837.75 per ounce after
hitting its lowest since June 2 earlier in the session.
    Analyst Carsten Menke at Julius Baer in Zurich said
palladium is likely to be pressured due to struggling car sales
in the United States and China, the world's two biggest markets.
    "We see palladium prices trading above fundamentally
justified levels," he said in a note.
    Platinum        dropped 1.2 percent to $899. It is down
about 2 percent so far this week.  

 (Additional reporting by Nithin Prasad and Vijaykumar Vedala in
Bengaluru; editing by Alexander Smith and Marguerita Choy)
  

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