Gold ETFs Jump 4% as Metal Tops $1,600 an Ounce
June 1st 2012 at 10:31am by John Spence
Gold exchange traded funds soared Friday after a miserable jobs report that had traders speculating the Federal Reserve will be forced to unleash additional stimulus to boost the economy.
Gold futures rallied back above $1,600 an ounce while the dollar weakened against the euro.
The largest precious metal ETF, SPDR Gold Shares (NYSEArca: GLD), rose 4.3% after the Labor Department said the U.S. economy added only 69,000 jobs in May, well below expectations.
Gold ETFs were rebounding on the first day of the month after dropping about 6% in May. [Gold ETFs Down in May on Dollar Surge]
Bullion holdings in gold exchange traded products saw the third monthly decline in May, according to Bloomberg data.
The May nonfarm payrolls report was “very poor and confirmed the midcycle slowdown in the United States,” Saxo Bank vice president Ole Hansen said in a Reuters report. “Whether it will be enough to change the mind of the Fed towards additional QE remains to be seen. At least the gold market believes it could happen.”
SPDR Gold Shares
Full disclosure: Tom Lydon’s clients own GLD.
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