Gold rises on oil, dollar; banks and investors buy
By Lewa Pardomuan
SINGAPORE (Reuters) - Gold extended gains on Monday, driven by purchases from banks, investors and speculators after oil prices jumped and weak U.S. payrolls data put pressure on the dollar.
Silver tracked gold, while platinum extended gains on persistent worries about output in main producer South Africa, which accounts for 80 percent of the world's supply.
Gold jumped to $915.00/915.60 an ounce from $908.40/909.20 an ounce on Friday but was still 11 percent below a record of $1,030.80 an ounce hit on March 17.
In addition to speculators, jewellers have been buying gold at the lows, helping the metal rebound from a two-month low of $872.90 an ounce last week.
"Most of the smart money is still on the long side. They include bullion banks, institutions and hedge funds. Whenever gold hits a new low, there's serious short covering in both gold and silver," said William Kwan of Phillip Futures in Singapore.
Oil prices jumped to a one-week high near $107 a barrel on Monday, extending last week's late rebound after the dollar fell and a fire hit a U.S. refinery.
But the dollar rallied against the yen on Monday, hitting a high of 102.68 yen on electronic trading platform EBS, due to buying from Japanese investors at the start of the new business year. The euro dipped to $1.5670.
The U.S. Labor Department on Friday said non-farm employment fell by 80,000 jobs in March, the biggest drop in five years, while the jobless rate jumped to a 2-½ year high of 5.1 percent, raising expectations of more rate cuts in April. Continued...
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