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The price of gold rose on July 8, which had the effect of dissipating the initial losses and consolidating above the US $ 1,400 swap, with the emphasis now being on the concerns linked to global growth and interest rate cuts by major central banks.
Spot gold was up 0.5% to $ 1,406.79 an ounce at 7:21 am GMT. Futures on US gold rose 0.6% to $ 1,408.90 an ounce.
In addition, the dollar slowed after several weeks high and the global stock markets are in red, which allowed the reversal of the metals trend after a fall of more than 1% on July 5, after the sharp drop in unemployment rate in the United States. US Federal Reserve.
"Despite the high numbers (jobs in the United States), the market is expecting a rate cut, but not as aggressive as it would have been. We are still in a cycle of ## 148 ## 39, easing rates, "said Howie Lee, an economist at OCBC Bank.
"In addition, US $ 1,400 represents a fairly high level of support for gold.In addition, growth remains weak and geopolitical tensions between the United States and Iran.Ground factors continue to support the rise in gold prices, "he added.
The nonagricultural payroll in the United States rebounded in June to 224,000, the highest total in five months, revealed data Friday, exceeding 160,000 estimated by consensus of economists.
Fed Chairman Jerome Powell is expected to provide further guidance on the near term outlook for monetary policy this week during his semiannual testimony to the US Congress on the Economy.
However, lingering moderate wage gains and increasingly clear evidence of deceleration of the economy could still prompt the Fed to cut interest rates this month.
A rate cut by the Fed could also prompt the Chinese central bank to reduce its key benchmark rate for the first time in four years to support the slowdown in the economy, badysts said.
Lower interest rates would support gold as they would reduce the opportunity cost of holding unproductive ingots.
US-Iranian tensions are also on the agenda of investors. Tehran announced on July 7 that it would soon increase its uranium enrichment rate above the ceiling set by a historic nuclear deal in 2015, prompting a warning from US President Donald Trump.
At the same time, the holdings of SPDR Gold Trust, the largest gold – backed exchange – traded fund in the world, fell 0.18 percent to 796.97 tons on Friday, from 798.44 tons on Wednesday.
On the technical side, spot gold could again test the resistance at $ 1,439 an ounce. As long as the metal remains above support at $ 1,387, it could resume its uptrend towards $ 1,497, according to Reuters technical badyst Wang Tao.
Among other precious metals, silver rose 0.6% to $ 15.06 an ounce, while palladium plunged 0.3% to $ 1,562.41.
The platinum rate rose 0.7% to $ 809.26, a little higher than its lowest level of the week, hit in the previous session.
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