Gold prices near 3 month low after robust US jobs report

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Tokyo | Published: November 9, 2015 7:46:50 AM

Gold languished near its lowest in three months on Monday following an eight-day losing streak, as surging U.S. nonfarm payrolls boosted expectations of a December rate hike in the United States.

Gold schemeGold fell as markets believed higher rates would hurt demand for the non-yielding asset. (Express Photo)

Gold languished near its lowest in three months on Monday following an eight-day losing streak, as surging U.S. nonfarm payrolls boosted expectations of a December rate hike in the United States.

Spot gold was little changed at $1,089 an ounce by 0023 GMT, following its worst week in two years. The metal had dropped to $1,084.90 on Friday, the lowest since August, after U.S. jobs data beat market expectations.

Gold is just about $12 away from a 5-1/2-year low hit in July. Employers outside the farming sector added 271,000 jobs in October, the most in 10 months, and the jobless rate fell to a 7-1/2-year low of 5 percent.

Economists had forecast nonfarm payrolls increasing 180,000 last month and the unemployment rate remaining at 5.1 percent. Policymakers at the U.S. central bank welcomed the data and investors increased bets that the first rate increase in nearly a decade will come next month, sending the dollar higher.

Futures markets shifted to show a 70 percent probability of a December rate hike, up from 58 percent before the report. Gold fell as markets believed higher rates would hurt demand for the non-yielding asset.

Assets in SPDR Gold Trust, the top gold-backed exchange-traded fund, fell 0.40 percent to 669.09 tonnes on Friday, the lowest in nearly three months, as investors exited bullion.

Hedge funds and money managers cut a bullish stance in COMEX gold as they trimmed a silver net long position from a record high in the week to Nov. 3, U.S. Commodity Futures Trading Commission data showed on Friday. * China likely added about 14 tonnes of gold to its reserves in October, according to Reuters calculations from central bank data on Saturday.

Among other precious metals, platinum fell to a one-month low of $930.50 an ounce. Palladium slid nearly 1 percent, and was trading near a six-week low.

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