Gold Falls Amid New Signs of Economy Rebound; Copper Jumps

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(Bloomberg) — Gold dropped as investors weighed further signals of an economic rebound, the latest being Friday’s better-than-expected U.S. jobs data.

Employers in the U.S. added the most jobs in seven months in March, amid a rollout of coronavirus vaccinations and an easing of business restrictions. Nonfarm payrolls increased by 916,000 from February, according to the Labor Department.

Commodity traders are also watching the progress of U.S. 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 trading is likely to be muted on Monday as markets in much of Europe, Australia, China and Hong Kong are shut for holidays.

Bullion posted its first quarterly drop since 2018 in the first three months of 2021, as U.S. bond yields rose amid more optimism over the post-pandemic economic recovery. That’s caused investors to turn more bearish on the precious metal — holdings in bullion-backed exchange-traded funds have dropped to the lowest since May, while hedge funds cut net bullish gold bets to a three-week low last week.

“Gold is likely to face an uphill climb — the global economy is recovering fast,” said Howie Lee, an economist at Oversea-Chinese Banking Corp.

Spot gold fell 0.3% to 1,723.38 an ounce at 1:11 p.m. in London. Silver, palladium and platinum all dropped. The Bloomberg Dollar Spot Index was little changed and Goldman Sachs Group Inc. dropped its short call on the currency.

Copper futures on the Comex rose 3% to $4.1175 a pound as investors assessed a decision by Chile, a major exporter, to close its borders during April.

The London Metal Exchange is shut Monday for the Easter holidays.

(A previous version of this story was corrected to show that copper rose)

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