Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold slipped 0.3% to close at a two-week low near $1,121 after a mixed U.S. nonfarm payrolls report confused the outlook for a rate increase. The metal finished the week down 1.1%, its first weekly loss in the last three weeks, after gaining 3.4% in August for its best month since January.

The Labor Department said the economy added 173,000 new jobs last month, fewer than forecast and well-below July's revised total of 245,000. It was the smallest monthly increase in more than two years. But the data was not all bad. Unemployment fell to 5.1%, the lowest level in more than seven years, while wages accelerated, suggesting a tighter labor market.

Despite its relatively weak headline number, the report was viewed by many economists as strong enough to permit the Fed to move forward with a rate hike in September, and equity markets seemed to agree. The Dow plunged 1.3% after the NFP report and the Global Dow lost 1.6%.

However, rising turmoil in global equity and currency market over the past several weeks, driven mainly by deep slowdowns in China's economy, have made the Fed more cautious. A panel of ex-Fed officials, convening at the Brookings Institute yesterday, concluded that the global economic outlook has worsened to the point that the Fed will delay raising rates until later this year.

The other precious metals were lower for the day and mixed for the week. Silver lost 1.1% today but edged up 0.1% this week. Platinum lost 1.8% today for a weekly loss of 2.8%; and palladium was down 0.8% and 2.2% this week.

At the Comex close: December gold slipped $3.10 to $1,121.40; December silver fell 16 cents to $14.55; October platinum dropped $17.70 to $992.40; and December palladium lost $4.40 to $577.15 an ounce.