MCX Bullion Weekly Report 6 June To 11 June 2011 | MCX Tips

Fundamental Market Overview
GOLD GAINS ON SOFT US JOBS DATA, FALLING DOLLAR
Gold rose to near its highest in a month on Friday, boosted by a weak
U.S. labor report that illustrated the fragile state of the economic
recovery, likely keeping rates low and the dollar weak for awhile. Bullion
jumped, while stocks and oil fell, in the wake of data showing U.S.
employers hired 54,000 workers in May, far fewer workers than
expected, and the unemployment rate rose to 9.1 percent. Technical View and Strategy Click Here

Gold was also bolstered by a slump in the dollar index to its lowest in a month.
Dealers said there were multiple reasons for Gold to gain on the latest
and strongest evidence of a softening economy: expectations of more
cheap money from the Federal Reserve; fears of deflation; a haven
from financial risk. While few analysts were prepared to forecast a
double-dip recession, the thought of fresh Federal Reserve funds
beyond the end of quantitative easing II (QEII) this month was enough
to spur some bids in an otherwise lackluster Gold market. U.S. futures
trading volumes was a below its norm by a third. Spot Gold rose to a
two-day peak of $1,546.39 a troy ounce after the payrolls release, but
pulled back to $1,541.10 from $1,532.55 an ounce late in New York on
Thursday. Gold hit a record high of $1,575.79 on May 2. Bullion posted
its highest weekly close since early May. August COMEX futures
posted $9.7 gains to $1,542.40 an ounce by the close. Gold priced in
sterling hit a record high of 946.79 pounds ($1,548) an ounce, as a
weaker dollar across a basket of currencies triggered a rush for the
precious metal. It was quoted at 938.55 sterling late in the session.


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