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MTECHTIPS:-Gold climbs ahead of U.S. nonfarm payrolls report

MTECHTIPS:-Gold climbs ahead of U.S. nonfarm payrolls report

Gold prices climbed in European morning hours on Friday, pulling away from a five-and-a-half year low as investors remained cautious ahead of the highly-anticipated U.S. nonfarm payrolls report due later in the day. On the Comex division of the New York Mercantile Exchange, gold futures for December delivery were up 0.53% at $1,095.80. The December contract ended Thursday’s session 0.41% higher at $1,090.10 an ounce. Futures were likely to find support at $1,079.20, the low from July 31 and resistance at $1,103.00, the high from July 31. Gold prices had weakened after the U.S. Department of Labor reported on Thursday thatthe number of individuals filing for initial jobless benefits in the week ending August 1 rose by 3,000 to 270,000 from the previous week’s total of 267,000. Analysts had expected initial jobless claims to rise by 6,000 to 273,000 last week. Market players now looked ahead to the U.S. nonfarm payrolls report due later Friday, amid ongoing expectations for a September rate hike. The consensus forecast is that the data will show jobs growth of 223,000 last month, while the jobless rate is forecast to hold steady at 5.3%. Gold has been under heavy selling pressure in recent months amid speculation the Federal Reserve will raise interest rates in September for the first time since 2006. Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
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