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Gold falls on upbeat job data, tightening concerns

04-02-2011 09:33 BJT

CHICAGO, April 1 (Xinhua) -- Gold futures on the COMEX Division of the New York Mercantile Exchange retreated on Friday, dented by stronger-than-expected U.S. job data and increasing concerns that U.S. Federal Reserve may tighten monetary policy soon. Silver and platinum both dropped.

The most active gold contract for June delivery fell 11 U.S. dollars, or 0.8 percent, to 1,428.9 dollars per ounce.

The U.S. Labor Department announced Friday that the unemployment rate dropped to 8.8 percent, which is the lowest since March 2009. The nonfarm payrolls increased by 216,000 in March, representing stronger-than-expected growth.

A market analyst noted that signs of improving economy will encourage Fed policy makers to raise the interest rate sooner than later, and the recent hawkish comments from Fed's officials implying that interest rate should rise by as much as 75 basis points by the end of year, helped keep unnerved investors away from gold.

A trader mentioned that the prospect of rising interest rates cast a shadow over the gold outlook, as it will raise the opportunity cost of holding the bullion significantly.

Meanwhile, strong gains by the greenback Friday morning, along with investor's profit-taking after gold hit settlement high in the previous session have both contributed to negative tone for the gold market.

May silver dropped 15.6 cents, or 0.4 percent, to 37.732 dollars. July platinum fell 6.3 dollars, or 0.4 percent, to 1,776. 9 dollars per ounce.

 

Editor:Yang Jie |Source: Xinhua

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