Gold jumps around one percent

January 11, 2014 - 2:36:47 am

LONDON: Gold rose around one percent yesterday after sharply weaker-than-expected US jobs data supported the view that the US Federal Reserve will take a gradual approach to tapering its bond-buying programme this year.

US nonfarm payrolls rose just 74,000 in December, the smallest increase in nearly three years and far below the 196,000 forecast by economists. The unemployment rate fell 0.3 percentage point to 6.7 percent. 

“This is a bad NFP release and has given gold a boost ... but one swallow does not make a summer and one bad NFP print doesn’t change 12 months of gold-bearish macroeconomic news,” Macquarie analyst Matthew Turner said.

Spot gold rose as much as 1.4 percent to a session high of $1,244.90 an ounce, and was up 1.3 percent to $1,243.40 by 1453 GMT. Prices were headed towards their third consecutive week of gains, up around 0.3 percent.

US gold futures for February delivery were up 1.1 percent to $1,242.80 an ounce.

Turkish lira edges off record lows

ISTANBUL:  Turkey’s lira inched off record lows yesterday but remained under pressure from a corruption scandal shaking the government and unease that a strong US jobs report could prompt a further reduction in the Fed’s bond-buying stimulus. 

A deepening feud between Prime Minister Tayyip Erdogan’s government and the judiciary and police has weighed on Turkish assets since the corruption investigation came to light last month. The inquiry has led three ministers to resign and damaged the ruling party ahead of elections this year.

Erdogan has cast the affair as a bid by US-based Turkish cleric Fethullah Gulen to smear his AK Party before a local election in March and a presidential race, in which he is expected to stand, five months later. 

In the first major poll since the scandal broke, the popularity of the ruling AK Party slipped, though it remains well ahead of rivals.