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Gold steady at $1,135 on positive US jobs and consumer borrowing data

Last updated: 23:42 08 Mar 2010 AEDT, First published: 00:42 09 Mar 2010 AEDT

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Gold made further advances this morning, stopping just short of US$1,140/oz after the non-farm payrolls update that came out in the US on Friday turned out to be better than expected, showing just 36,000 jobs lost instead of a projected decline of up to 70,000, while consumer borrowing data showed the first increase in a year today to drive up equity markets and further boost investors’ appetite for riskier assets such as gold.

The bullish economic updates pushed down the US dollar, which is considered a safe haven asset. Gold is seen as an alternative investment and usually moves inversely to the American currency.

Meanwhile, the euro extended gains after rising for most of the previous week as the outlook for Greece’s debt crisis improved after the unveiling of a fresh economic austerity package and a successful bond issue that raised the debt laden country €5 billion to help it meet its near term commitments.

Later in the day the US dollar recovered, pushing gold down as it continued trading within a narrow range around US$1,135/oz.

Other precious metals followed with silver climbing to US$17.48/oz and platinum hitting seven week highs at US$1,605/oz.

Major mining companies were mixed today. Platinum miner Lonmin (LSE: LMI) led the sector in the FTSE 100 with a gain of nearly 1%. Randgold Resources (LSE: RRS) was flat, while silver and gold producer Fresnillo (LSE: FRES) rose marginally.

Specialty chemicals firm Johnson Matthey (LSE: JMAT) made little headway.

Silver producer Hochschild Mining (LSE: HOC) was flat, while fellow FTSE 250 miners Aquarius Platinum (LSE: AQP) and gold producer Petropavlovsk (LSE: POG) lost about 1%.

Kyrgyzstan focused gold explorer and developer Chaarat Gold Holdings (AIM: CGH) was one of the top performers in the sector, rallying 16%. Africa operating gold and platinum miner Goldplat (AIM: GDP) also did well, adding 6%.

Uzbekistan focused gold miner Oxus Gold (AIM: OXS) headed in the opposite direction with a 5% loss.

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