Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

Austin— Gold edged up 0.1% to close near $1,221 as data on wage-growth weighed on the dollar, boosting demand for alternative assets. The metal close the week 2.4% higher, notching its best weekly win since June.

The U.S. added 227,000 jobs to nonfarm payrolls in January, the most in four months, suggesting solid momentum in the labor market. But the details were less optimistic, with hourly wages rising by a disappointing 0.1%, well short of expectations, and the unemployment rate ticking up to 4.8%.

After rising initially on the headline number of new jobs, the dollar retreated on the details as traders speculated that the wage and unemployment data will not be enough to spur the Fed to raise interest rates in March. At its meeting on policy this week, the central bank gave no indication of the timing of future hikes, adding to the buck's loss of 0.9% this week.

Capping gold's gains, U.S. equities rallied, with the Dow jumping 1% higher and the S&P 500 adding around 0.7%. The gains were led by banking shares after Donald Trump took steps to roll back financial regulations levied in response to the financial crisis.

The World Gold Council reported global demand for gold rose 2% in 2016 to a three-year high, led by a 70% increase in investment demand, the most in four years. Gold-backed ETFs were especially popular, adding 532 tonnes for the year, the second-biggest annual increase on record. The main drivers were the uncertain path of future interest rate hikes, the US election, negative interest rates and price momentum.

The other precious metals were mixed for the day but higher for the week. Silver added 0.3% for a weekly gain of 1.7%. Platinum rose 0.7% on the day and 1.7% on the week. Palladium fell 1.3% but still gained 2.8% for the week.

At the Comex close: April gold edged up $1.40 to $1,220.80; March silver gained 5 cents to $17.48; April platinum rose $7.10 to $1,006.70; and March palladium lost $10.05 to $749 an ounce.