Gold holds advance as rate increase dims after US jobs crater
[SINGAPORE] Gold held its gains after a weak US jobs report signaled that the Federal Reserve may delay an interest- rate increase on concerns the economy is faltering. Gold companies shares surged.
Bullion for immediate delivery advanced as much as 0.4 per cent to US$1,248.85 an ounce before trading at US$1,243.77 at 9:18 am in Singapore, according to Bloomberg generic pricing. The metal rose 2.7 per cent on Friday, as traders cut bets that the Fed will tighten monetary policy in June or July.
The US added 38,000 workers in May, the fewest since Sept 2010, a Labour Department report showed Friday. Odds of a June hike implied by futures trading, which had risen as high as 34 per cent last month, tumbled to just 4 per cent. Fed Chair Janet Yellen will address the World Affairs Council of Philadelphia on Monday.
"The weak US jobs data saw investors rush back into gold as speculation of the Fed not hiking rates" at its upcoming meeting increased, analysts at Australia & New Zealand Banking Group Ltd said in a note Monday.
Newcrest Mining Ltd, Australia's largest gold producer, climbed as much as 10 per cent and headed for the biggest daily increase in almost three years, while Regis Resources Ltd soared as much as 14 per cent.
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