Gold eases on firmer US dollar, investors await US jobs data

[BENGALURU] Gold prices turned negative on Friday on a firmer US dollar, while investors focused on the US jobs data due later in the day for fresh catalysts.

Spot gold was down 0.1 per cent at US$1,309.93 per ounce at 0740 GMT, and was headed for a third consecutive weekly decline. US gold futures for June delivery fell 0.15 per cent to US$1,310.70 per ounce.

"The focus is on the US nonfarm payroll data ... We see dollar index rising once again on expectations of higher number and that's what is affecting gold price," said Naeem Aslam, chief markets analyst at Think Markets. The dollar index was up about 0.1 per cent at 92.498 with the focus on whether US jobs data will provide the spark for another push higher.

Against a basket of currencies, the index touched a 2018 peak of 92.834 on Wednesday. The greenback was on track for an about 1 per cent gain for the week. The employment report for April will be evaluated for further indications of the strength of the US labour market and inflation pressures.

Nonfarm payrolls (NFP) likely increased by 192,000 jobs in April after rising 103,000 in March, according to a Reuters survey of economists. "Gold bears may be offered an opportunity to attack and conquer the US$1,300 level today, if the NFP data results exceed market expectations," said Lukman Otunuga, research analyst at FXTM.

Spot gold is biased to bounce more to a resistance at US$1,326 per ounce, as suggested by a projection analysis and a falling channel, according to Reuters technical analyst Wang Tao. Holding of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.13 per cent to 865.60 tonnes on Thursday.

Among other precious metals, spot silver was flat at US$16.41 per ounce. Platinum fell 0.1 per cent to US$898.80 per ounce and was on track for a third weekly fall. Palladium inched lower to 0.1 per cent to US$961.50 per ounce.

REUTERS