Investors spooked by the debt crises in Greece and Portugal, who had driven gold back over $1,530 per ounce on Thursday, gave back just a bit in tracking euro losses on Friday. Prices of the precious metal were down Friday morning, with spot gold bid at $1,527.66 per ounce in midday European trading against late Thursday’s price of $1,531.85 in New York. U.S. gold futures for August delivery dropped back $2.30 to $1,528.30. Spot gold had reached $1,534.20 per ounce, its highest since June 23, the day before.
Reuters quoted Mitsui & Co Precious Metals analyst David Jollie as saying, “If you look at the euro zone situation, that is still there, and a lot of European investors would still like more diversity than just holding euros. That can be a risk aversion thing rather than a view that gold will appreciate in price.”
However, it looks as if gold may be headed higher. Part of its price drop in overseas early trading Friday was in anticipation of a strong jobs report from the U.S., which was expected to add 90,000 jobs. HSBC analyst James Steel said in a note before the report came out, “Data indicating economic growth are generally bearish for gold, as it also encourages higher interest rates.”