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Gold Pares Early Gains, Settles Lower After Powell's Comments

Gold Pares Early Gains, Settles Lower After Powell's Comments

Gold futures failed to hold early gains on Friday, weighed down by positive comments about the U.S. economy from the Federal Reserve Chairman Jerome Powell.

Gold prices had edged higher earlier in the session after data from the Labor Department showed a much less than expected growth in U.S. jobs in August.

Gold futures for December ended down $10.00, or about 0.7%, at $1,515.50 an ounce, well off the day’s high of $1,536.20 an ounce.

On Thursday, gold futures for December ended down $34.90, or 2.2%, at $1,525.50 an ounce, suffering the biggest single-session loss in dollar terms, since November 11, 2016.

For the week, gold futures shed about 0.9%.

Silver futures for December ended down $0.688, at $18.119 an ounce, while Copper futures for December settled at $2.6340 per pound, losing $0.0080.

Speaking at a forum in Zurich, Switzerland, Fed chief Powell said the central bank has helped keep the economy on solid ground amid the uncertainty caused by Trump’s trade war with China.

Powell said that despite the uncertainty caused by the trade war, the Fed does not currently anticipate a recession, noting the labor market and consumer spending remain strong.

“We’re not forecasting or expecting a recession,” the Fed chief said. “The most likely outlook is still moderate growth, a strong labor market and inflation continuing to move back up.” He also reiterated that the Fed will “act as appropriate” to sustain the U.S. economic expansion.

Data released by the Labor Department today showed employment in the U.S. increased by 130,000 jobs in August, after climbing by a downwardly revised 159,000 jobs in July.

Economists had expected employment to increase by 158,000 jobs compared to the addition of 164,000 jobs originally reported for the previous month.

The Labor Department also said the unemployment rate held at 3.7 percent in August, unchanged from July and in line with economist estimates.

The material has been provided by InstaForex Company – www.instaforex.com