Gold futures lost ground for a sixth straight session on Friday night, our time, ending up with a 5% fall for the week, the biggest weekly slide in 3-years.
After the big fall earlier in the week, prices were volatile in Friday trading, rising, and then giving up those early gains as traders looked at the September jobs report – 156,000 new positions, an unemployment rate rising to 5%, but that was due to 400,000 more people looking for work which was the big positive.
Trading today and tonight will be impacted by the Columbus Day holiday in the US. The Bond market will be closed, but share and other markets will see trading continue.
And there’s the second US Presidential debate at midday, Sydney time.
Traders concluded there was nothing in the jobs report to change market thinking that a rate rise in December from the Fed, remains distinct possibility.
Comex December gold fell $US1.10, or 0.1%, for the session to settle at $US1,251.90 an ounce after touching a high of $US1,267.60.
Prices fell about 5% for the week, according to FactSet data. That was the largest one-week decline since mid-September 2013.
Comex silver, saw bigger losses this wee than gold – losing close to 10%. December silver fell 3.5 cents, or 0.2%, to $US17.38 an ounce Friday, ending about 9.6% lower for the week.
Comex December copper did better than either gold or silver of the week.
It was up less than a cent at $US2.164 a pound, finishing about 2.1% lower on the week. January platinum fell $US3.70, or 0.4%, to $US962.60 an ounce, to lose 7% for the week, while December palladium added $US1.25, or 0.2%, to $US667.40 an ounce, but still lost 7.5% for the week.
And while analysts at Goldman Sachs say a fall below $US1,250 is likely, they also say that it could be a buying opportunity “given substantial downside risks to global growth remain, and given that the market is likely to remain concerned about the ability of monetary policy to respond to any potential shocks to growth”.
Goldman Sachs acknowledged that a rate rise from the Fed in December, and rising US real interest rates generally, could pressure the price of gold. But they say demand for the metal through exchange-traded funds and bars is likely to remain intact.
Chinese investment demand for gold may also pick up following the sell-off, the bank said.
“The potential drivers of increased Chinese physical buying include purchasing gold as a way to hedge for potential currency depreciation in the face of capital controls, and purchasing gold as a way of diversifying away from the property market,” the analysts said.
