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PRECIOUS-Gold rises as bleak U.S. jobs data dents dollar

· 02/07/2021 19:55
PRECIOUS-Gold rises as bleak U.S. jobs data dents dollar

- Gold prices edged higher on Monday, as weaker-than-expected U.S. jobs data re-ignited concerns over a recovery in the world's largest economy, pressuring the dollar and boosting bullion's appeal.


FUNDAMENTALS

* Spot gold XAU= rose 0.1% to $1,813.99 per ounce by 0040 GMT. U.S. gold futures GCv1 gained 0.2% to $1,816.50.

* The dollar .DXY fell from an over two-month peak on Friday after a U.S. jobs report indicated a slow recovery from the impacts of the COVID-19 pandemic. A weaker dollar makes gold cheaper for holders of other currencies. USD/

* The employment report on Friday showed job losses in manufacturing and construction, two sectors which have been propping up the economy. nL1N2KA34D

* U.S. President Joe Biden and his Democratic allies in Congress forged ahead with their $1.9 trillion COVID-19 relief package on Friday. nL1N2KD0A7

* Capping gold's gains, yields on the benchmark 10-year Treasury note soared to levels not seen in nearly a year. Higher yields increase the opportunity cost of holding non-yielding bullion. US/

* Breakevens on 10-year Treasury Inflation-Protected Securities US10YTIP=RR, which measure average annual inflation expectations for the coming decade, have jumped to 2.19%, the highest level since mid-2018. nL1N2KA2P3

* Gold is considered a hedge against inflation and currency debasement, likely from widespread stimulus.

* Speculators reduced their bullish positions in COMEX gold and silver contracts in the week to Feb. 2, data showed on Friday. CFTC/

* Physical gold demand picked up in China last week ahead of the Lunar New Year festival, while Indian retail buyers cheered a sharp dip in domestic rates. GOL/AS

* Spot silver XAG= gained 1.1% to $27.12 an ounce, platinum XPT= rose 0.7% to $1,130.91 and palladium XPD= was steady at $2,336.29.


DATA/EVENTS AHEAD (GMT)

0700 Germany Industrial Output MM Dec


(Reporting by Sumita Layek in Bengaluru; Editing by Krishna Chandra Eluri)

((Sumita.Layek@thomsonreuters.com; Within U.S. +1 646 223 8780, Outside U.S. +91 8061822693; Reuters Messaging: Sumita.Layek.thomsonreuters.com@reuters.net))