New York - Arabstoday
Gold eased on Friday, snapping a five-session winning streak, but trade was choppy as investors digested a report of better US job growth and the unemployment rate near a three-year low. The metal still notched its biggest weekly gain in five weeks after it broke ranks with a slumping euro on Thursday and Friday. Bullion has now more than recouped last week\'s losses that briefly sent it into bear market territory. Trading volume was decent after data showed US non-farm payrolls increased 200,000 in December and the unemployment rate dropped to a near three-year low of 8.5 per cent, offering the strongest evidence yet the economic recovery was gaining steam. Under pressure \"Gold came under pressure because people are a bit more comfortable with the recovery of the economy, but it is going to remain range-bound until we get some significant news to push it into either direction,\" said Fred Schoenstein, metals trader at Heraeus Precious Metals Management. Spot gold fell 0.3 per cent to $1,617.19 an ounce. It was up 3 per cent for the week, its first weekly rise since early December. \"Gold went up after a lot of year-end liquidation last week. Money managers have to put their [gold] position back if they want to have it in their portfolio to show it to their clients,\" said Schoenstein. US gold for February delivery settled down $3.30 at $1,616.80. Trading volume was strong for a fourth straight day, about 10 per cent above its 30-day average, preliminary Reuters data showed. Analysts said high turnover signalled renewed buying interest after gold fell sharply in thin holiday volume. The euro hit a near 16-month low against the dollar and briefly traded below $1.27, the first time since September 2010, on renewed sovereign funding concerns in Europe and worries about a recession there. In lockstep Gold had been trading in lockstep with the euro in the past two months when the metal crossed into a bear market. Last week, the precious metal was briefly 20 per cent below its record September high. The 25-day correlation log between spot gold and euro was near a one-year high reached last week, indicating a strong positive link between the two in the last month. \"Although gold seems to be decoupling from the euro... we believe gold\'s inverse correlation with the dollar and positive correlation with the euro will be re-established,\" James Steel, HSBC\'s chief commodity analyst, said in a research note.