Gold and silver tumbled to a fresh 4-1/2 year low as the US dollar rallied its biggest weekly gain in more than 16 months. And expectations the Federal Reserve could raise rates sooner rather than later.
Bloomberg dollar spot index, which tracks the US dollar against 10 major currency peers, stayed close to its highest in more than five years before the monthly employment report from the US, curbing demand for bullion as a hedge assets.
A strong non-farm payrolls in the US by the end of the day could elaborate evidence of a stronger economy, which influence the Fed and the gold possibly hurt as a non-interest bearing asset.
After trading subdued at first, comex gold futures slid 1 percent to $1,130.40 an ounce – their lowest since March 2010.
Gold for immediate delivery was 0.8 percent declined at $1,131.85 an ounce at 06:22 a.m. in London, lowest since April 2010 – before recovering modestly to $1,133.30 according to Bloomberg generic pricing.
Spot silver fell to $15.03 – the bottom trademark since February 2010 reached – as it addressed its fourth consecutive weekly decline.
The massive sale-off in gold began one week ago when the metal broke up through $ 1,180 – the lowest level attained during a slump of 28 percent last year. This past Friday, the strength in the dollar breaks below key support levels have followed pull on gold.
The report on US employment today is viewed as a potential trigger for the dollar and gold bullion which could send speeding toward $ 1,000 an ounce, a level untouched since October 2009.
“Pressure is released today in gold and silver. In the domestic market, gold remains below 25,500. The international market is also looking to idling trading. With a marginally gain of 0.04 percent on MCX gold December futures is trading at Rs 25,472. And with 0.32 per cent rise on MCX silver December futures is trading at Rs 34,382.” 100McxTips bullion experts said.
For latest commodity market tips, MCX tips, news & updates with 100McxTips Commodity Advisory, follow us on Twitter and Like on Facebook. And to contact the reporter on this story email at firstname.lastname@example.org or Call: +91-761-4012307