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Gold extends drop as U.S. jobs data spurs taper fears

Source : REUTERS
Last Updated: Mon, Nov 11, 2013 03:26 hrs
An employee arranges gold jewellery in the counter as her arm is reflected in the mirror at a gold shop in Wuhan

​Gold eased on Monday to trade near three-week lows after an unexpectedly strong U.S. jobs report reignited fears the Federal Reserve could begin scaling back its support for the economy soon.

FUNDAMENTALS

Spot gold fell 0.2 percent to $1,286.19 an ounce by 0020 GMT. It lost 1.7 percent on Friday - the metal's biggest one-day drop in more than a month.

Data from the U.S. Labor Department showed employers added 204,000 new jobs to their payrolls last month, well above estimates of 125,000, showing resilience of the economy despite a partial government shutdown.

Investors are watching key data on the U.S. economy to gauge when the Fed could begin tapering its $85 billion monthly bond purchases. They fear that strong data would prompt the U.S. central bank to cut back purchases before the end of the year.

Barrick Gold Corp signaled on Friday that founder and Chairman Peter Munk will likely leave the board at next year's annual meeting, a move that sources say is intended to persuade reluctant investors to buy into the miner's $3 billion equity offering.

About 2,300 South African mineworkers staged an underground sit-in at Anglo American Platinum's Dishaba mine, saying they will not leave until a suspended union leader is reinstated, the company said on Sunday.

Hedge funds and money managers broadly cut bullish bets in futures and options of U.S. gold, silver and copper in the week to November 5, a report by the Commodity Futures Trading Commission showed on Friday.

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