Gold jumps after US payrolls data disappoints
Gold rose 1.5 percent on Friday after weaker-than-expected U.S. nonfarm payrolls increased confusions over when the Federal Reserve will start paring back its massive bond-buying stimulus.
Despite Friday's rally, gold ended the week 0.5 percent lower for a second consecutive weekly loss as its safe-haven appeal dropped on a lack of progress about possible U.S. military strikes against Syria.
Bullion jumped as much as $30 or 2 percent after data showed U.S. employers hired fewer workers than expected in August and the jobless rate hit a 4-1/2 year low as Americans gave up the search for work.
The disappointing report complicates the Fed's decision on whether to scale back its monetary stimulus later this month, as the U.S. central bank is set to deliver its next policy statement on Sept. 18.
"There is a lot of uncertainty with Syria and the Fed tapering. Those two forces are very much on most traders' minds right now," said Albert Ng, a market maker and portfolio manager at Aurum Options Strategies in New York.
U.S. President Barack Obama resisted pressure on Friday to abandon plans for air strikes against Syria and enlisted the support of 10 fellow leaders for a "strong" response to a chemical weapons attack.
Spot gold was up 1.5 percent to $1,387.46 an ounce. U.S. gold futures for December delivery settled up $13.50 at $1,386.50 an ounce, with volume about 10 percent below its 30-day average, preliminary Reuters data showed.
The worse-than-expected U.S. jobs data suggests that tapering of the Fed's $85 billion monthly bond-purchases, known as quantitative easing, could be pushed back further than had previously been expected, said Mitsui Precious Metals analyst David Jollie.
The Fed should begin reducing monthly bond purchases at a meeting later this month in order to set monetary policy on a course for "gradual and predictable" normalization, Kansas City Fed President Esther George, a top U.S. central banker, said on Friday.
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