May 8, 2020 / 4:11 AM / a month ago

PRECIOUS-Gold hovers near two-week high ahead of U.S. jobs data

 (Adds comments, updates prices)
    * Gold on track for about 1% weekly gain 
    * U.S. non-farm payrolls due at 1230 GMT
    * Non-farm payrolls forecast to drop by historic 22 mln in
April
    * For an interactive graphic tracking the global spread,
open tmsnrt.rs/3aIRuz7
 in an external browser

    By Shreyansi Singh
    May 8 (Reuters) - Gold was hovering near a two-week high on
Friday as investors awaited the U.S. jobs report to gauge the
health of the economy after grim economic data raised the
prospects of more rate cuts by the Federal Reserve.
    Lower interest rates would further weigh on bond yields and
boost demand for non-yielding bullion.
    Spot gold        was steady at $1,717.49 per ounce, as of
0712 GMT, having hit its highest since April 27 at $1,721.76 in
the previous session. U.S. gold futures         added 0.2% to
$1,729.70. 
    The metal gained about 2% on Thursday on the back of bleak
U.S. economic data, which along with uncertainties over global
economic recovery and U.S.-China relations. So far this week,
gold is up about 1%.
    "Gold is still bouncing around in the $1,650 to $1,750 an
ounce range of the last month or so. Serious investors interest
should not be piqued until gold comprehensively challenges
either of those levels," said Jeffrey Halley, senior market
analyst at OANDA.
    Millions more Americans sought unemployment benefits last
week, with the total number of people who have filed claims
since March 21 rising to about 33.5 million, data showed on
Thursday.             
    U.S. nonfarm payrolls data, due at 1230 GMT, is forecast to
have plunged by a historic 22 million in April, which would blow
away the record dive seen during the 2007-2009 recession.
            
    "Record non-farm payrolls data could lead to further global
economic uncertainty, that is likely to support gold prices,"
said Hareesh V, head of commodity research at Geojit Financial
Services.
    "In the medium to long term, investors are likely to remain
invested in gold as a safe market because of the recession fears
that are likely to continue for many months."
    Financial markets began pricing in a negative U.S. interest
rate environment for the first time, while the Bank of England
kept the door open on Thursday for more stimulus next month.
                                     
    "Funds futures fell overnight, signalling lower rates ahead
that fed through to the U.S. dollar, which saw profit taking on
longs overnight," said Halley, adding that this created a
positive environment for gold.
    The dollar index        turned negative, while the U.S.
Treasury yields fell from three-week highs, with the two-year
yields dropping to record lows.             
    Elsewhere, palladium        jumped 2.1% to $1,895.40,
platinum        rose 0.2% to $764.74 per ounce.
    Silver        was flat at $15.50 per ounce, having hit a
three-week peak.

 (Reporting by Shreyansi Singh and Swati Verma in Bengaluru,
Editing by Sherry Jacob-Phillips and Jane Merriman)
  
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