Gold climbs Rs 397 in futures trade on global cues

Expectations of lower demand after revelations last month that Volkswagen falsified USA vehicle emission tests, which a few believe could affect demand for diesel cars, hit platinum prices.

The data lifted prices off two-week lows, fuelling concerns that a China-led global economic slowdown is sapping U.S. economic strength and reinvigorating the moribund bullion market that had been rangebound for months.

The spot gold price was last at $1,134.50/1,134.80 per ounce, down $3.30 on Friday’s close but trading in a narrow intraday range so far. The metal had gained 2.2 percent on Friday, its biggest one-day rise since January 15.

“Only 142,000 new jobs were created in September, moreover, the figures for the preceding months were downwardly revised and wage pressure was surprisingly subdued”.

A December rate rise appears to be off the table, with most market participants now not expecting the USA central bank to move before April next year. While much of the volume was likely due to short-covering, “some people are starting to dip their toes in for long positioning too (for a rate hike)”, said Bart Melek, head of commodity strategy for TD Securities in Toronto.

“Gold will be looking for a move above $1,140 to consolidate Fridays’ leg higher, with targets extending to the 100 DMA at $1,147 and the 200 DMA at $1,179”, MKS said in a note. “The interest rate rise is the mechanism by which the (US jobs data) is being rated but the real issue is whether the United States economy is slowing”, Macquarie analyst Matthew Turner said.

Among the other precious metals, silver rose 2.9% to $15.708 an ounce, platinum rose 0.4% to $912.90 an ounce and palladium fell 1.2% to $689.20 an ounce. It turned down 0.8 per cent to $US689.72.