Gold News & Info

Source: Bill Musgrave, American Gold Exchange

Austin— Gold fell for a third session, dropping 0.5% to close at $1,163.50, as residual optimism that Greece will strike a deal with its creditors outweighed subpar U.S. jobs data to reduce safe-haven demand. The metal finished the holiday-shortened week down 0.8%.

As Greece prepares for an emergency bailout referendum on Sunday, mixed messages from its troika of creditors�IMF, ECB, EC�are leading investors to believe that a deal will ultimately be struck to keep it in the Eurozone. The IMF said today that the nearly insolvent nation will need debt extensions and write-downs if the measures are not approved, suggesting that the troika will continue negotiating despite posturing to the contrary.

Gold opened the session by dropping as low as $1,156 before recovering after the June U.S. non-farm payroll report was much weaker than expected. Employers added 223,000 jobs last month, down from 254,000 in May and substantially fewer than forecast. In another sign that job growth is stalling, totals for May and April were revised lower by 60,000.

While the unemployment rate dropped to 5.3%, a five-year low, it was attributed to nearly half a million people leaving the work-force, driving the labor-participation rate to the lowest since 1977.

The dollar fell from a three-week high after the disappointing jobs data, as traders speculated that the Fed will now be less likely to raise interest rates in September. A delay in the first rate hike is considered bullish for gold because higher rates boost the dollar, pressuring commodities like precious metals that are denominated in the currency for international trade by making them more expensive to foreign buyers.

The other precious metals were down for the day but mixed for the week. Silver edged down 0.1% for a weekly loss of 1%. Platinum slid 0.4% today but gained 0.3% this week. Palladium lost 1% on the day but held a 2% gain on the week.

At the Comex close: August gold fell $5.80 to $1,163.50; September silver dropped less than 2 cents to $15.56; October platinum slid $3.80 to $1,084; and September palladium shed $7.05 to $694.15 an ounce.