July 7, 2017 / 5:23 AM / 4 months ago

PRECIOUS-Gold edges down, set for biggest weekly drop in 2 mths

 (Recasts, updates prices, adds details)
    * Silver hits 15-month low
    * Spot gold may fall into $1,204-$1,211 range- technicals

    By Nithin ThomasPrasad
    BENGALURU, July 7 (Reuters) - Gold fell on Friday and was
set for its biggest weekly loss in two months as investors
sought higher returns from a firmer U.S. dollar and rising
Treasury yields, and ahead of U.S. non-farm payrolls data later
in the day. 
    Spot gold        edged 0.2 percent lower to $1,221.76 per
ounce at 0706 GMT. It has dropped 1.6 percent this week and is
set for its biggest weekly fall since the week of May 5. 
    U.S. gold futures         for August delivery fell 0.2
percent to $1,221.30 per ounce.
    "We are somewhat concerned about gold's ability to hold up
and see more weakness that could set in, especially if Friday's
payroll number sets off another spike in U.S. yields," INTL
FCStone analyst Edward Meir said in a note.
    Higher yields seem to be the prime negative driver in gold
for the moment, he added. 
    Dollar-denominated bullion typically loses value when the
greenback and U.S. Treasury bond rates rise since the yellow
metal does not bear interest.      
    Investors are looking ahead to the monthly U.S. employment
data later on Friday after downbeat private payroll figures
overnight pointed to some loss of momentum in job growth as the
labor market nears full employment.                 
    "The primary focus will be on the wage growth component
given the Fed's overriding concern about inflation," said
Stephen Innes, head of trading for Asia Pacific at OANDA in
Singapore, adding "the G-20 summit should not be ignored."
    Spot gold may fall into a range of $1,204 to $1,211 an
ounce, as suggested by its wave pattern and a Fibonacci
projection analysis, according to Reuters technical analyst,
Wang Tao.
    "Gold has been weighed down by overall bearish sentiment
toward the sector, with a spike higher in bond yields over the
last fortnight contributing to the soft tone," said Jordan
Eliseo, chief economist at gold trader ABC Bullion.       
    U.S. Treasury yields rose on Thursday, with benchmark yields
touching nearly eight-week highs, while the dollar gained in
Asian trading on Friday.               
    Silver        fell 0.6 percent to $15.90 per ounce. 
    Earlier in the session, the white metal touched $14.86 an
ounce, its lowest in 15 months in what appeared to have been
driven by an accidental order, according to traders. It is down
4.2 percent on week.
    Palladium        climbed 0.3 percent to $837.25 per ounce
after hitting its lowest since June 2 earlier in the session.
    Platinum        fell 0.7 percent to $903.70 per ounce. It is
down about 2 percent for the week so far.  

 (Reporting by Nithin Prasad and Vijaykumar Vedala in Bengaluru;
Editing by Christian Schmollinger and Biju Dwarakanath)

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