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The gold price took another big hit on Friday on better than expected US jobs data from a key employment report released on Friday morning.
As of 9:39 am PST, spot gold was down $36, while gold futures for August delivery dropped $34, or 2.4 percent, to $1,381.50 an ounce.
The declines came after a generally positive week for the precious metal, which climbed 1.2 percent on Thursday and was on track for a third weekly gain above the $1,400 per ounce mark. However, the rally was quickly extinguished when the Labor Department showed the United States created 175,000 jobs in May, above the expected 164,000 reported MarketWatch.
That caused the US dollar to rise and gold to fall, even though the US unemployment rate actually rose a percentage point to 7.6 percent. US stock markets also gained on the news as investors continued to pile into equities, at the expense of precious metals — with the Dow Jones Industrial Average rising above 15,000.
Gold’s fall on Friday was further exacerbated by US Fed Chair Ben Bernanke’s comment on CNBC that the central bank should “get moving” on slowing down QE3, MarketWatch said.
The bond-purchase program that effectively prints $85 billion a month has been bullish for gold which is a hedge against inflation and currency devaluation.