Hedge funds slash bullish wagers on gold over Trump election win
Hedge funds and other large speculators boosted net-long positions by 11% to 197,362 as of Nov. 12, the lowest in 14 weeks.
Better than expected US jobs data hit gold hard Friday morning as the precious metal dropped 2% to $1,222.
Investors expect increasing job numbers to trigger a cut in the Fed’s $85 billion per month bond-purchases.
The US economy added 195,000 jobs in June – 30,000 more than analysts expected. The positive economic data restored some confidence in the dollar sending it to near three-year highs, Reuters reports.
A strong dollar is usually accompanied by weak precious metals prices which have proven highly sensitive to US economic activity. Gold saw major losses in June following the Fed’s announcement on the future of quantitative easing.
Other precious metals did not escape the blow – silver declined to $18.7 compared to $19.7 on Wednesday’s close and platinum lost $31 hitting $1,311.
Creative Commons image by: Giorgio Monteforti
