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March 6, 2010 – Gold bullion prices remained steady on Friday as economic conditions kept investor interest strong. According to Saxo Bank senior manager Ole Hansen, "The view among many is still that they worry about missing the boat and there has been buying into the break through at $1,131." Gold prices ended the day up $1.90 to close at $1,135.40, holding above its resistance point near $1,130.
Gold bullion prices were strong on positive non-farm payroll news which showed a drop of 36,000 jobs, the lowest total in nearly two years; the unemployment rate remained at 9.7 percent. Mr. Hansen observed, "The better-than-expected non-farm payrolls initially took gold lower as the market moved in tandem with the stronger dollar." The lows didn’t hold as gold broke from trending with the dollar and moved higher.
The US Dollar Index closed the day at 80.43, down 0.129. It had initially rallied on the employment news and the Purchasing Managers Index which exceeded the expected 51.0 percent to post a 53.0; any number above 50 percent indicates growth.
Prices stayed relatively steady in spite of the favorable numbers, due to the fact that they met analysts’ expectations. “This series of reports are on target, which means you probably won’t get [a significant increase],” said Doug Roberts, chief investment strategist for Channel Capital.
Analysts are expressing optimism that gold bullion prices will remain strong in the medium term, as employment increases are expected and the Federal Reserve keeps interest rates low, encouraging further investment.
