Investing.com - Gold futures reversed losses to end Friday's session mildly higher as traders continued to mull the timing of a Federal Reserve rate hike following the release of solid U.S. nonfarm payrolls data.
The Labor Department reported that the U.S. economy added 215,000 jobs last month, slightly lower than forecasts for an increase of 223,000, but still consistent with strong employment growth. The unemployment rate remained unchanged at 5.3%, in line with expectations.
Hourly earnings, a component of the jobs report that the Federal Reserve has said must rise, ticked up 0.2%, also matching forecasts after stalling in the previous month.
The data did little to alter expectations for a September rate increase by the Federal Reserve, but it tempered speculation for multiple rate hikes before the end of the year.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, eased to 97.66, after touching three-month highs of 98.42 earlier. The index ended the week with gains of 0.18%.
The greenback has been boosted recently by expectations that the improving U.S. economy will prompt the Federal Reserve to raise short term interest rates as early as September.
Gold futures for August delivery on the Comex division of the New York Mercantile Exchange hit an intraday low of $1,081.40 a troy ounce on Friday before recovering to end the session at $1,094.10, up $4.00, or 0.37%, for the day.
For the week, prices of the precious metal declined $1.00, or 0.09%, the sixth weekly loss in the past seven weeks, as ongoing expectations that the Federal Reserve will hike interest rates at its September policy meeting weighed.
Gold fell to a five-and-a-half year low of $1,072.30 on July 24 amid speculation the Federal Reserve will raise interest rates in September for the first time since 2006.
Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
Also on the Comex, silver futures for September delivery rose 14.4 cents, or 0.98%, on Friday to settle at $14.82 a troy ounce by close of trade. On the week, silver prices tacked on 7.1 cents, or 0.52%, the second straight weekly advance.
Elsewhere in metals trading, copper for September delivery shed 0.8 cents, or 0.36%, on Friday to settle at $2.332 a pound after tumbling to a session low of $2.313, a level not seen since June 2009.
For the week, copper prices dropped 2.3 cents, or 1.31%, the sixth consecutive weekly loss, amid growing concerns over the health of China's economy.
Government data released on Sunday showed that Chinese inflation for July rose 1.6%, above expectations for 1.5% and up from 1.4% in June.
The producer price index fell by a more-than-expected 5.4% last month, underling concerns over the health of the world's second largest economy.
On Saturday, data showed that the country’s trade surplus narrowed to $43.0 billion last month from $46.5 billion in June, compared to estimates for a surplus of $53.3 billion.
Chinese exports slumped 8.3% from a year earlier, worse than forecasts for a decline of 1.0%, while imports dropped 8.1%, disappointing expectations for a drop of 8.0%.
A slowdown in domestic demand indicated a recovery in the broader economy remains fragile and may need further government stimulus.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
In the week ahead, investors will be looking to Thursday’s U.S. retail sales data for a further indication on the durability of the economic recovery. Speeches by Fed officials on Monday will also be in focus.
Meanwhile, copper traders are looking ahead to a raft of Chinese economic data in the week ahead, including reports on industrial production, fixed asset investment and retail sales.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, August 10
Federal Reserve Governor Stanley Fischer and Atlanta Fed President Dennis Lockhart are to speak; their comments will be closely watched.
Tuesday, August 11
The U.S. is to release preliminary data on unit labor costs.
Wednesday, August 12
China is to publish data on industrial production and fixed asset investment.
Thursday, August 13
The U.S. is to produce data on retail sales, initial jobless claims and import prices.
Friday, August 14
The euro zone is to publish preliminary data on second quarter economic growth as well as revised data on consumer inflation.
The U.S. is to release data on producer prices, industrial production and consumer sentiment to round up the week.