Singapore - Gold headed for a second weekly decline as speculation the Federal Reserve will raise interest rates amid a strengthening US economy outweighed demand for a haven spurred by Greece’s debt crisis.
Bullion for immediate delivery was at $1,167.81 an ounce at 2.26pm in Singapore from $1,166.26 on Thursday, when the metal fell to $1,157.18, the lowest since March 18, according to Bloomberg generic pricing. Prices are set for a 0.7 percent drop this week, extending last week’s 2.1 percent decline.
Investors’ focus shifted to when the Federal Reserve will raise interest rates before Greece’s weekend referendum on austerity measures that may help to determine whether the country remains in the euro zone. A Labor Department report on Thursday showed US companies added 223 000 jobs in June while wages stagnated and the size of the labour force receded.
“Despite the slightly soft tone evident in” the data, the labour market momentum remains robust, Australia & New Zealand Banking Group Ltd said in a note on Friday. “September remains on the cards for the Fed to commence its hiking cycle.”
Central bank officials, who will meet this month, want to see continued improvement in the jobs market and have confidence inflation will pick up before they raise the benchmark federal funds rate, which they have held near zero since December 2008. They have two more jobs reports before the September meeting.
Futures for August delivery added 0.3 percent to $1,166.50 on the Comex after three days of losses. Metal of 99.99 percent purity lost as much as 0.5 percent to 231.50 yuan a gram ($1,160.18) on the Shanghai Gold Exchange before trading little changed at 232.78 yuan.
Silver for immediate delivery fell 0.2 percent to $15.6648 an ounce after advancing 0.7 percent on Thursday, when it snapped five days of declines.
Platinum was at $1,083.38 an ounce from $1,084.25, little changed for the week. Palladium headed for a 2 percent gain this week, the first such increase in about two months, and traded at $692.75 an ounce from $694.05.
Bloomberg