Home Fundamental Comment Gold records sharpest daily drop after robust U.S. jobless claims figures
Gold records sharpest daily drop after robust U.S. jobless claims figures

Gold records sharpest daily drop after robust U.S. jobless claims figures

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gold-bangleGold prices posted the sharpest daily drop in nearly two months Thursday, after a U.S. report showed jobless claims slipped to the lowest level in 15 years.

First-time applicants for jobless benefits declined last week to 262,000, the lowest since April 15, 2000, from 295,000 a week earlier. Analysts had penciled in a drop to 290,000.

The strong labour-market data raised speculations the Fed may raise interest rates in September, damping speculations that rate hike will not take place until 2016.

Gold has plunged, so far, more than 2 percent, after the rise in U.S. Treasury yields, given the fact assets with yields weigh on gold and other commodities that provide no interest to their holders.

The yellow metal plummeted on Wednesday after the Fed statement illustrated that U.S. growth will rebound to a “moderate pace,” and the ease in first-quarter expansion is transitory.

Despite the drop in the U.S. dollar against a basket of major currencies to a low of 95.17, according to the dollar index, gold prices failed to rise.

In the same context, gold prices did not take a boost from the advance in oil prices.

Crude oil futures for June delivery rose for a third straight session to trade around $59 a barrel.

Meanwhile, gold is set for a third straight monthly drop, after shaving all the gains recorded in April.

As of 17:47 GMT, gold traded around $1180.50 an ounce, after hitting a bottom of $1176.97.

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Ahmed Mamdouh Ahmed Mamdouh, Co-Founder and Head of English Fundamental Analysis at FXComment.com, with 7 years of experience in the financial markets. Mamdouh holds a Master’s Degree in Economics from The American University in Cairo and a Bachelor Degree in Economics from The Faculty of Economics and Political Science, Cairo University.

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