El Salvador lawmakers overturn mining ban in win for president
The legislation will grant the Salvadoran government sole authority over mining activities within the country's land and maritime territory.
Gold prices steadied during the holiday-thinned trading session on Monday as robust US jobs data fueled hopes for a rapid economic recovery and bolstered global equities, suppressing bullion’s appeal.
Spot gold saw a slight gain of 0.1% to $1,731.80/oz by 11:40 a.m. EST, while US gold futures rose 0.2% to $1,732.20/oz.
An earlier report showed that employers in the US added the most jobs in seven months during March, as more coronavirus vaccinations and fewer business restrictions bolstered labor market recovery.
Non-farm payrolls increased by 916,000 from February, according to a Labor Department report released on the Good Friday holiday.
“The outstanding jump in employment is fueling optimism that growth this year will be extraordinary, boosting both stocks and interest rates, which pulls gold in opposite directions,” Tai Wong, head of metals derivatives trading at BMO Capital Markets, wrote in a note to Bloomberg.
Meanwhile, the Bloomberg Dollar Spot Index fell 0.3% and Goldman Sachs Group dropped its short call on the currency.
Still, bullion trading volume remains muted as markets in much of Europe, Australia, China and Hong Kong are shut for the Easter Monday holiday.
Gold prices this year had their first quarterly drop since 2018 as US bond yields rose amid more optimism over the post-pandemic economic recovery. That has caused investors to turn more bearish on the precious metal — holdings in bullion-backed exchange-traded funds have dropped to the lowest since last May, while hedge funds cut net bullish gold bets to a three-week low last week.
Commodity traders are also watching the progress of US President Joe Biden’s $2.25 trillion infrastructure spending proposal. Republicans, wary of the tax increases needed to fund it, have said they may support a smaller plan.
“Gold is likely to face an uphill climb — the global economy is recovering fast,” said Howie Lee, an economist at Oversea-Chinese Banking Corp.
(With files from Bloomberg)
