Gold adds 0.5% while silver adds 2%
Bullion prices ended higher on Wednesday, 05 February 2014. Gold futures settled higher on Wednesday, finding support as U.S. equities traded mostly lower following a weaker-than-expected report on private-sector employment. Still, some upbeat economic data caused gold to briefly pare some of its earlier gains and prices for silver, an industrial metal, to move up.
Gold for April delivery rose $5.70, or 0.5%, to settle at $1,256.90 an ounce on the Comex division of the New York Mercantile Exchange.
March silver added 38 cents, or 2%, to $19.805 an ounce.
The ADP national employment report was released Wednesday morning and showed a rise of 175,000 jobs in January. The consensus forecast was for a rise of 189,000 jobs in the ADP report. Gold extended its price gains in the aftermath of the slightly weaker-than-expected ADP report. However, as the trading session progressed gold gradually gave back all of those ADP-inspired gains.
While traders and investors are still concerned about the situation regarding some emerging market currencies being in turmoil, most of those troubled smaller currencies have stabilized this week. This helped the Japanese stock market make a recovery Wednesday. The Chinese Lunar New Year holiday has China on holiday this week. That is keeping other Asian markets somewhat subdued.
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In overnight news, the European Union issued a retail sales report for December that was down 1.6% on the month and down 1.0% on the year. The Euro Zone purchasing managers index (PMI) for January came in at 52.9 in January versus 52.1 in December. This data comes just ahead of the monthly meeting on monetary policy by the European Central Bank on Thursday.
The recent spate of disappointing U.S. economic data has put even more importance on Friday's monthly U.S. jobs report for January. A weaker-than-expected jobs report on Friday would call into question how much more the Fed would be able reduce its monthly bond-buying program, also called quantitative easing. Late last year the U.S. central bank announced its tapering program, whereby the Fed is slowly scaling back its monthly bond purchases. The early forecasts are for the non-farm payrolls figure of the Labor Department's employment report to come in at up around 190,000 in January.
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