4 Min Read
* U.S. payrolls up 192,000 in March, slightly below estimate
* Gold posts biggest one-day rise in almost one month
* Job data eases worries Fed will raise rates soon -analyst
* Coming up: U.S. consumer credit Friday (Updates market activities, milestones)
By Frank Tang and Clara Denina
NEW YORK/LONDON, April 4 (Reuters) - Gold rose more than 1 percent on Friday, its biggest daily gain in nearly a month, after data showing brisk U.S. employment growth in March unleashed heavy short-covering by bullion investors who had feared the job figures would sharply exceed Wall Street's expectations.
In a brisk turnaround from heavy selling in the days before the release of the data, prices were up 1 percent for the week, the first increase in three weeks.
The Labor Department said U.S. nonfarm payrolls increased by 192,000 jobs last month, slightly below economists' estimate of 200,000.
Some in the bullion market had expected an even stronger jobs report.
"Everyone had been saying the job number was going to be so much better, but the economy didn't improve the way investors had expected, and that's why the short-sellers are covering their positions," said Miguel Perez-Santalla, vice president at BullionVault in New York.
Analysts said the figure eased fears of an early interest rate increase by the Federal Reserve, lifting assets particularly sensitive to interest rate changes such as gold and U.S. Treasury bonds.
Spot gold rose 1.2 percent to $1,302.91 an ounce by 2:47 p.m. EDT (1847 GMT), having earlier reached $1,306.50 - the highest since March 27.
U.S. COMEX gold futures for June delivery settled up $18.90 at $1,303.50 an ounce.
Turnover was not particularly strong, however, with volume at 130,000 lots, about 30 percent below the 30-day average of 200,000 contracts, preliminary Reuters data showed.
Bullion rose as other financial markets were volatile, with U.S. equities, as measured by the S&P 500 index, sliding more than 1 percent after initial gains, and U.S. Treasury yields falling.
"The (jobs) numbers are OK but they are not the boost that the policymakers had been hoping for, so the Fed will have to keep interest rates low for a considerable period of time, and that's what's been supporting gold," said Axel Merk, chief investment officer at California-based Merk Funds, a firm with more than $400 million in currency mutual fund assets.
Silver rose 0.6 percent to $19.91 an ounce, tracking gold's rise.
Earlier, gold prices drew some support after Iraq's central bank said its gold reserves had reached 90 tonnes after it bought 60 tonnes over the past two months.
In physical market news, banks in China have been importing less gold over the past month as demand waned after the festival season, while cheaper prices at home due to a softer yuan also curbed overseas purchases of the precious metal, banking sources and traders said.
Among platinum group metals, platinum climbed 0.7 percent to $1,446.50, and palladium was up 0.3 percent at $786 an ounce. 2:47 p.m. EDT LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL US Gold JUN 1303.50 18.90 1.5 1284.40 1307.50 128,519 US Silver MAY 19.946 0.141 0.7 19.785 20.230 37,851 US Plat JUL 1450.90 5.40 0.4 1436.60 1452.00 6,129 US Pall JUN 790.75 1.90 0.2 783.15 792.85 2,720 Gold 1302.91 15.91 1.2 1284.40 1306.50 Silver 19.910 0.120 0.6 19.810 20.220 Platinum 1446.50 10.70 0.7 1436.50 1449.00 Palladium 786.00 2.10 0.3 784.50 790.50 TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 30D AVG 250D AVG CURRENT CHG US Gold 134,071 200,760 181,847 15.75 -0.30 US Silver 46,730 47,542 58,253 21.7 -0.81 US Platinum 6,173 17,766 12,516 18.48 -1.31 US Palladium 2,796 6,251 5,808 28.7 0.29 (Additional reporting by A. Ananthalakshmi in Singapore; Editing by Steve Orlofsky and Grant McCool)