Gold futures finished with a modest loss on Friday as better-than-expected U.S. employment figures dulled the precious metal’s safe-haven appeal.
For the week, however, gold found support from the European Central Bank’s decision to cut interest rates and from strength in physical demand to end the week 0.7% higher.
Gold for June delivery fell $3.40, or 0.2%, to settle at $1,464.20 U.S. an ounce on the Comex division of the New York Mercantile Exchange.
The U.S. economy created a net 165,000 jobs in April, the U.S. Labor Department said Friday. The number surpassed the 135,000 forecast of economists. The acceleration in hiring nudged the unemployment rate down to 7.5%, the lowest level since December 2008.
Right before the data’s release, gold prices were trading around $13 U.S. an ounce higher
Gold on Thursday gained $21.40 U.S., or 1.5%, in the wake of the fresh stimulus from the ECB. The central bank lowered its main refinancing rate by a quarter-percentage point to 0.5%, and reduced the interest rate on the marginal-lending facility by 0.5 percentage point to 1%.
ECB President Mario Draghi said monetary policy would remain "accommodative."
Friday’s employment data followed the Federal Reserve’s widely expected decision this week to continue buying $85 billion a month in assets until there is substantial improvement in the labor market.
Analysts have said more monetary stimulus could put pressure on the U.S. dollar , which in turn could help dollar-denominated gold prices. Easy monetary policies can also raise the risk of inflation, and gold is seen as an inflation hedge.
Gold prices have recently been recovering after a massive selloff in April. Year to date, they’re still down about 13%
