Mid-Day Gold & Silver Market Report – 04/09/2012

Brandi Brundidge

4/9/2012 12:20:00 PM

GOLD FINDS SUPPORT ON WEAK JOBS DATA; CHINA WARY OF INFLATION  

Friday’s disappointing U.S. jobs data continued to support higher Gold prices through midday trading. Friday’s report indicated fewer workers were hired by U.S. employers in March, reviving hopes that monetary easing might again be in the cards. For the first time since November, hiring fell below 200,000. Overall, the current low interest rate environment remains positive for Gold, but “Gold will need to find a firmer footing first,” Barclays Capital analysts said.

Some economists see Friday’s labor numbers as a minor setback, and that the downturn in hiring numbers will prove temporary. “While the economy is going to do OK, we think jobs are going to be doing better than OK,” said Bruce Kasman, of JPMorgan in New York, in a conference call following the Labor Department’s employment report. “We don’t think today’s number represents the trend,” he said.

China’s higher-than-expected annual inflation reading for March also is adding support for Gold. “If we see more RRR (reserve requirement ratio) cuts, it will be positive for Gold as it will raise inflation outlook down the road,” said Li Ning with Shanghai CIFCO Futures. Analysts are not concerned that this inflation data would slow its pro-growth monetary policy. Last year, China’s demand for physical Gold increased by 20 percent, and it’s set to replace India as the world’s top Gold consumer.

At noon (CDT), the APMEX precious metals spot prices were:

• Gold - $1,646.00 – Up $15.40.
• Silver - $31.67 – Down $0.13.
• Platinum - $1,616.80 – Up $10.20.
• Palladium - $646.00 – Up $0.20.

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