Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold gained 0.4% to close at a two-week high above $1,247 as another round of weak employment data and equivocal comments from Janet Yellen tempered the outlook for higher interest rates in the near future.

On the heels of Friday's terrible nonfarm payrolls report, which showed a paltry 38,000 jobs added in May, new measures of labor health have come in distinctly soft. An in-house Federal Reserve index tracking 19 employment indicators was negative for the fifth straight month in May, marking the weakest stretch since the Great Recession in 2009. And an employment gauge from the Conference Board also fell last month, suggesting job growth will remain anemic through the summer.

The Fed has repeatedly staked higher rates to ongoing employment growth. Friday's extremely disappointed payrolls data shifted seriously change the odds. CME Fedwatch now sees a 4% chance of higher rates this month, down from 21% before the jobs report. July is now at 27%, down from 58%.

In a speech today, Fed Chair Yellen said little to tip her hand about the timing. Acknowledging that higher rate as are probably coming "if incoming data are consistent with labor market conditions strengthening and inflation making progress toward our 2 percent objective," she dropped the "in coming months" signal she gave two weeks ago.

The dollar eased slightly against major rivals after Yellen's comments. A softer dollar supports gold and other commodities denominated in it for international trade by making them less expensive overseas.

The other precious metals also gained, with silver adding 0.5% while platinum and palladium rose 1.5% and 1.6%, respectively.

At the Comes close: August gold gained $4.50 to $1,247.40; July silver added 8 cents, to $16.45; July platinum picked up $15.10 to $997; and September palladium rose $9.10 to $558.45 an ounce.