Gold bullion prices fell hard for euro and dollar investors Friday lunchtime in London, unwinding this week's 1.2% gains as world stock and commodity markets jumped in response to new US jobs data.
August's non-farm payrolls report surprised analysts with a headline drop for August of 54,000 - half the losses expected - plus stronger-than-forecast growth in private-sector hiring, up by 67,000.
"The private sector has net created a total of 622,000 jobs since last November," noted Deutsche Bank analysts ahead of Friday's announcement.
"This is still fairly low compared to the 8.459 million private jobs lost during the previous two years."
Overall, the US unemployment rate crept up to 9.6%, with average earnings rising more slowly than expected from a year earlier.
"[Gold] is what I call wealth insurance," said Peter Hambro, mining-magnate and chairman of London-listed Russia gold miner Petropavlovsk Plc, to Bloomberg earlier this week.
"Everyone has health insurance, fire insurance...gold is what is going to protect you from the ravages of government...There is no way out for these guys except to inflate away debt.
"I'm afraid that unless you have some real assets, you're going to be in trouble."
Elsewhere on Friday, new data showed Swiss consumer prices stayed flat in August, while German and UK service-sector growth was slower than expected.
Retail sales across the 16-nation Eurozone rose by 0.1% from July, the official data agency said - just half the tepid rate of expansion analysts forecast.
"The truth is that we have not had much of a recovery in the first place," says New York professor and economics consultant Nouriel Roubini, writing for Forbes magazine, "which might prevent the economy from falling enough to display what many would label a double dip [in the US] - although we are now assigning a 40% probability to such an outcome."
Back in the gold bullion market, overnight trading in Asia was "cautious" according to one dealer's note, but the US jobs data promised "an exciting close to the week", especially with New York heading into the long Labor Day weekend.
Over in Mumbai, "There are no [gold bullion] deals at these rates," said a state-owned bank dealer to Reuters this morning. "There is an initial resistance from traders to accept near-record prices."
Gold prices for Indian consumers - the world's No.1 buyers, now entering the strong post-harvest festival season - held just shy of recent records at 19,200 rupees per gram on Friday.
Ahead of the peak gold demand typically seen during Dhanteras in November, "We are expecting festivals like Ganesh Chathurti and Navratri may bring in sales," said another dealer.
A Reuters poll of 10 analysts and dealers says Indian gold imports (it has next-to-no domestic gold mining output) will rise 5% to 504 tonnes in full-year 2010.
Elsewhere in the commodities market, New York crude-oil futures jumped through $75 per barrel on the US jobs data, with the broad hard-asset indices reversing an earlier drop to show a 0.5% on the day.
"We are bullish on silver," says the latest technical note from bullion-bank Scotia Mocatta, "looking for an eventual test of the 2008 high of $21.35 an ounce.
Silver traded wholesale in London today gave back 1.1% from a new four-month high at $19.76. Supporting its bullish stance, says Scotia, the gold/silver ratio "broke lower" on Thursday through August's bottom, meaning that one ounce of gold is worth fewer ounces of silver.
Moving down to 63.75, the gold/silver ratio looks bullish for silver prices while it remains "below 64.90," says Scotia, "and we see April's low of 62.66 as the next major [level]."
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Adrian Ash runs the research desk at BullionVault. Formerly head of editorial at Fleet Street Publications - London's top publisher of financial advice for private investors - he was City correspondent for The Daily Reckoning from 2003 to 2008, and is now a regular contributor to a number of investment websites.