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Gold Prices - Weekly Outlook: June 4 - 8

Published 03/06/2018, 11:11
Updated 03/06/2018, 11:21
Gold settles under $1,300 after upbeat U.S. jobs data
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Investing.com - Gold traders will keep their focus on more trade-related headlines in the coming week, as President Donald Trump prepares to meet world leaders at the G7 summit in Canada.

Fresh geopolitical developments surrounding President Trump's planned meeting with North Korean leader Kim Jong Un slated for later this month will also be on the agenda.

With a lack of major economic reports in the coming week, market participants will pay extra close attention to monthly trade figures out of the U.S., amid the ongoing threat of a global trade war.

There are no Federal Reserve speakers in the coming week since it is the quiet period ahead of the June 12-13 Federal Open Market Committee meeting, when the Fed is widely expected to raise interest rates.

The U.S. central bank is increasingly likely to raise rates a fourth time this year after Friday's upbeat employment report showed U.S. job growth accelerated in May and the unemployment rate dropped to an 18-year low of 3.8%.

The U.S. Labor Department's report also showed solid wage gains, pointing to rapidly tightening labor market conditions, which could stir concerns about inflation.

Gold settled back below $1,300 an ounce on Friday, as the U.S. jobs report buoyed the dollar and suggested that the Fed remains on track to raise interest rates later this month and later this year.

Expectations for higher interest rates tend to be bearish for gold, which struggles to compete with yield-bearing assets when rates rise.

Gold's losses Friday also came as relief swept across global financial markets after Italy's two main populist parties struck a deal to form a coalition government, ending months of political deadlock and averting a summer ballot that was seen as a de facto referendum risking a euro crisis.

Gold futures for August delivery settled down $5.40, or 0.4%, at $1,299.30 a troy ounce on the Comex division of the New York Mercantile Exchange late Friday, its lowest finish since May 23.

It logged a loss of about 0.7% for the week.

Elsewhere in precious metals trading, silver futures declined 0.2% at $16.42 a troy ounce, with the contract ending about 0.6% lower for the week.

Among base metals, copper ended at $3.091, up around 0.9% for the session and gaining 0.7% for the week.

Ahead of the coming week, Investing.com has compiled a list of significant events likely to affect the markets.

Monday, June 4

The UK is to release data on construction sector activity.

Tuesday, June 5

China is to publish its Caixin services index.

The Reserve Bank of Australia is to announce its benchmark interest rate and publish a rate statement which outlines economic conditions and the factors affecting the monetary policy decision.

The UK is to produce data on service sector activity.

The U.S. Institute for Supply Management is to publish its non-manufacturing index.

Wednesday, June 6

The U.S. is to publish data on labor costs and productivity as well as the monthly international trade report.

Thursday, June 7

The U.S. is to publish weekly data on jobless claims.

Friday, June 8

China is to report on trade figures.

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