Platinum rallied 5 percent on talk of a new exchange-traded fund and gold hit a fresh eight-week high on Friday, but prices corrected after the US unemployment rate fell to a 5-1/2 year low, traders said.
The stronger jobs data persuaded some investors to sell the precious metals they had bought earlier this week as a safe-haven investment, when the dollar fell on worries about the deteriorating health of the US economy.
Spot gold was at 1550 GMT quoted at $624.50/$625.50 an ounce, up from $623.90/4.90 late in New York on Thursday, but below an earlier session peak of $626.75 an ounce, a level last seen in early September. Platinum hit $1,213 an ounce, the highest since September 11, a rise of more than 15 percent since the six-month low of $1,050 seen on October 24.
It was last quoted at $1,185/1,191 an ounce, up from $1,155/1,161 on Thursday, when it jumped nearly 5.2 percent, the biggest one-day gain since October 3, 2001. "All precious metals fell back ... US jobs data punctured sentiment, but it's probably only temporary ... these numbers are usually very volatile," a trader said.
"Every other bit of data we've seen from the US this week has been positive for gold and precious metals." US unemployment fell to 4.4 percent in October, the lowest since 4.3 percent in May 2001, from 4.6 percent in September.
Non-farm payrolls rose by 92,000, below the consensus estimate of 125,000, but the September number was revised up to 148,000 nearly three-times the original estimate.
Gold is still up about 5 percent this week. Investors piled into gold earlier as a spate of weak data from the United States suggested the world's largest economy may be heading for a hard landing, which also pushed the dollar to one-month lows against the euro and helped gold. When the US currency falls it makes dollar-denominated gold more expensive for investors in other currencies.
The launch of a platinum ETF would potentially mean the issuer of the security would have to buy large amounts of the precious metal.
Silver prices hit a three-month high of $12.95 an ounce early in September on concerns that the growing popularity of a silver ETF would use up a significant chunk of the metal supply. Exchange-traded commodity funds have become more popular with investors over the last couple of years as a way to get exposure to commodity markets in large or small amounts.
They can be used as stand-alone investments or for hedging investment portfolios. "A platinum ETF ... that's the rumour going round ... it sounds quite plausible and funds have been pre-empting it," James Moore, analyst at TheBullionDesk.com, said.
Fund buying pushed platinum through key resistance at the $1,160 level, an area of congestion which triggered further buying, traders said.
Silver was softer at $12.50/12.56 an ounce from $12.53/12.60 in New York on Thursday, but down from an earlier 8-week session high of $12.65. Palladium, which seemed to have missed this week's precious metal rally, changed tack and also hit a eight-week high of $337 an ounce. It was last quoted at $324/329 an ounce, above $321/326 in late New York on Thursday.
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