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Gold edges higher as weak U.S. payrolls keeps pressure on dollar Thomson Financial | April 7, 2008 Gold edged higher in early London trade as the dollar remained under pressure following weak U.S. payrolls data on Friday. The U.S. labour department reported non-farm employment fell by 80,000 jobs in March and concerns over the state of the world's largest economy and the depreciation of its currency remain uppermost in trader's minds. Gold has been boosted by the ongoing financial turmoil because it acts as a store of wealth and as an alternative investment to the U.S. currency. 'U.S. non-farm payrolls data cemented the view that the U.S. is slowing significantly, and that the U.S. dollar therefore has little prospects for gains in the short term,' said BNP Paribas (other-otc: BNPQY.PK - news - people ) analyst David Thurtell. (Article continues below)
At 9.56 a.m., spot gold was trading at $913.73 an ounce against $909.80 in late New York trades on Friday. Elevated oil prices are also providing support, with gold investors buying bullion to hedge against rising inflation. Oil rose to a week high close of $107 today. While gold has recovered some ground since touching a two month low of $872.40 an ounce last week, investors are still wary of backing the precious metal to move back up to the $1,000 level seen in March. Bargain hunting from jewellers has played a role in moving the metal back above $900, but physical buying interest has been limited at higher levels. James Moore at TheBullionDesk.com said gold prices were likely to remain volatile as the metal builds a more stable base around the $900 level, adding that the recent financial turmoil could force some investors to close out their positions in precious metals. CLICK ON THE BANNER TO BUY TERRORSTORM IN |
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