Gold prices rise after weak payrolls release; set for weekly loss

Gold prices rose Friday, boosted by signs of U.S. labor market weakness which weighed on the dollar, but were still headed for weekly losses.

At 08:50 ET (13:50 GMT), Spot gold traded 0.7% higher at $5,117.52 an ounce and gold futures gained 0.9% to $5,124.70/oz.

The precious metal was on track to slip around 3% this week, with recent strength in the dollar and reduced interest-rate-cut expectations pressuring bullion.

Weak payrolls release 

Economic data released earlier Friday showed that total U.S. nonfarm payroll employment unexpectedly edged down by 92,000 jobs in February, compared to estimates for an addition of 58,000.

January’s job total was revised down to 126,000, from 130,000.

The unemployment rate accelerated to 4.4%, faster than expectations that it would match January’s pace of 4.3%.

Signs of weakness in the U.S. labor market have hit the US Dollar Index, which fell 0.3%, as investors reassessed the likelihood for the Federal Reserve to cut rates in the near future.

The dollar had been in demand this week, and is still on track for a hefty weekly jump, as the conflict in the Middle East had provided support for this safe haven..

Oil prices were set to surge over 18% this week as the conflict threatened key energy infrastructure and shipping routes in the Gulf. The surge in crude prices has fueled concerns about a renewed wave of global inflation.

This has complicated the outlook for global central banks, including the U.S. Federal Reserve. Higher oil prices tend to feed into inflation and could make policymakers more cautious about cutting interest rates in the near term.

Gold supported by Iran conflict worries

Fighting between the U.S, Israel, and Iran has intensified over the past week, with missile strikes and retaliatory attacks spreading across the region and raising fears of disruptions to global energy supplies.

U.S. President Donald Trump said he wanted a role in deciding Iran’s next leader once the war ends, remarks that underscored heightened uncertainty over the region’s political future.

Gold typically benefits from geopolitical uncertainty and lower interest rates, but the metal has struggled to gain momentum this week as the stronger dollar and rising bond yields reduced its appeal.

LME copper stocks surge

Among other precious metals, silver prices rose 2.1% to $83.875 per ounce, while platinum gained 0.6% to $2,142.80/oz.

Benchmark Copper Futures on the London Metal Exchange slipped 0.4% to $12,883.70 a ton, while U.S.Copper Futures traded largely unchanged at $5.8050 a pound.

Copper stocks tracked by the LME exchange jumped almost 8% to a 16‑month high on Thursday.

"The inventory build reflects strong inflows into LME warehouses, driven by shifting regional pricing incentives. LME copper has been trading at only a narrow premium to Comex, reversing last year’s structure that encouraged metal to flow into US warehouses. As these pricing signals normalise, metal is increasingly being redirected back into global exchange stocks," said analysts at ING, in a note.