Gold Edges Higher As Dollar Retreats
Gold futures edged higher to recover a fraction of recently-lost ground during Asian trading hours Monday, with a weaker dollar providing some support.
Gold futures for December delivery ticked up $5.10 to $1,680.40 an ounce in electronic trading on the Comex division of the New York Mercantile Exchange.
In regular trading hours on Friday, gold futures tumbled $40.30, or 2.4%, to settle at $1,675.20 an ounce, the metal’s lowest level since last August. Read: Gold drops over $40, suffers fourth weekly loss
The losses were triggered by a better-than-expected report on U.S. employment, which showed payrolls rose 171,000 in October, well above the 120,000 new jobs that economists had expected. Read: U.S. adds 171,000 jobs as hiring picks up
Julian Jessop at Capital Economics said that the drop for the precious metal Friday underlined its sensitivity to expectations of further central-bank monetary support.
“Commodity markets are probably right to be thinking that they cannot rely both on a strong economic recovery in the U.S. and unlimited largesse from the Fed,” they said. 
The data also triggered gains for the dollar, adding more pressure on metal prices. A stronger dollar tends to weigh on prices for dollar-denominated commodities such as gold, since it makes them more expensive for holders of other currencies.
Monday’s slight rebound for gold futures came as the dollar retreated slightly, with the ICE dollar index at 80.592, down fractionally from 80.600 in late North American trading Friday. Read: Dollar rallies as jobs data spur QE doubts
For a stronger rebound, gold will need a new catalyst, Jessop believes.
“This is likely to come soon in the form of a renewed escalation of the crisis in the euro zone and a revival of safe-haven demand,” he said.
Deutsche Bank commodity strategists said that they expected a renewed weakening in the U.S. dollar to help precious-metal returns into the end of the year.
“We find a weak seasonal tendency for the U.S. dollar to display extreme weakness during December,” they said.
Across the rest of the metals complex, silver for December delivery rose 6 cents to $30.02 an ounce, palladium futures for delivery in the same month rose $1.10 to $600.75 an ounce, while platinum for delivery in January rose 40 cents to $1,545.30 an ounce.
December copper futures edged down 1 cent to $3.47 per pound.
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