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London - Gold held below an almost two-week high as traders awaited a speech from Federal Reserve Chair Janet Yellen after US jobs data dashed speculation that interest rates would increase soon.
The metal was little changed after rallying the most since February on Friday when a report showed the US economy created the fewest jobs last month in almost six years, weakening the dollar.
The odds of the Fed raising rates by July halved to 27% after the data and the probability of a move this month is just 4%, Fed Funds futures show.
The metal dropped as much as 8% since May 2, when it reached the highest in more than a year, as speculation grew that the economy is strong enough to allow higher borrowing costs, curbing the appeal of assets that don’t pay interest.
Yellen will speak on Monday in Philadelphia, the last scheduled speech by an official before the Fed’s next meeting concludes on June 15.
"Gold is trading quietly ahead of Janet Yellen’s speech later today," Ole Hansen, head of commodity strategy at Saxo Bank A/S, said by e-mail.
"The sentiment improved sharply following the weak US job report on Friday as it helped weaken the dollar while reducing the risk of a July rate hike.”
Gold price
Bullion for immediate delivery lost 0.3% to $1 241.10 an ounce at 11:16 a.m. in London, according to Bloomberg generic pricing. It jumped 2.7% on Friday and is up 17% this year.
Prices may be supported at about $1 225 and $1 230 after facing resistance near $1 250 in earlier trading, Hansen said.
The FTSE/JSE Africa Gold Mining Index gained 0.7% and earlier touched the highest since May 19 in Johannesburg.
Newcrest Mining, Australia’s largest gold producer climbed 12% for its biggest daily increase since 2008.
Newcrest isn’t part of the FTSE/JSE gauge and Australian markets had closed before the US jobs data was released on Friday.
In other precious metals news:
Holdings in gold-backed exchange-traded funds rose 6.2 metric tons to 1 858.2 tonnes as of Friday, the highest level since November 2013, data compiled by Bloomberg show.
Silver and platinum prices were little changed while palladium rose 0.3%.
