After taking a bit of a breather by the close on Thursday, spot gold resumed its winning ways on Friday, setting its ninth intraday record high in as many days.
While SA has dropped substantially on the list of gold producers over the past couple of decades, there was a pick-up in 2023, when the country, the world’s ninth biggest producer, upped its output by about 12%, with an increase of 11-million kilograms.
Spurring the yellow metal’s forge ahead on Friday was a better than expected nonfarm payroll report out of the US, which created 50% more jobs than expected in March. Total new members of the workforce came in at 303,000, the biggest gain in 10 months.
With inflation proving to be stubbornly high, an increase in employment in the US could worsen the situation, making gold the ideal safe-haven partner for investors as it is a hedge against both inflation and geopolitical tension.
Higher inflation indicates it will take longer for interest rates to come down, with expectations having dropped over the past couple of weeks that the US Federal Reserve will start lowering rates in June.
Friday’s data saw the euro firm 0.2% to $1.0844, while at 6pm gold had gained 1.72% to $2,328.19/oz. The yellow metal ended the week up more than 12.5%.
The rand outperformed many of its emerging market peers, firming 0.3% to R18.6529/$, 0.25% to R20.2273/€ and 0.27% to R23.5636/£. This brought its gains against the dollar to 2% so far this year.
After outperforming most global bourses on Thursday, the JSE gave back some of those gains on Friday, as stock markets across the globe, with the exception of the US, fell on the surprising jobs numbers.
The JSE ended the day down 0.79% at 74,774 points, with the biggest losers being industrial metals and miners, and resources, which fell 0.85% and 0.84%.
Bucking the trend were construction group Wilson Bayly Holmes Ovcon, up 2.07% to R136.48, and industrial equipment producer Barloworld, which added 1.82% to R63.87.
AngloGold Ashanti performed best in its sector, up 0.78% to R445.44, bringing its gains for the year to 26%.
Brent crude gained for a seventh straight day, up 0.64% to $91.57, as the war in Gaza continued to threaten to turn into a wider Middle East conflict.
The Israeli army said late on Friday it had fired two of its senior army officers after seven aid workers were killed in Gaza earlier this week.
Brent is now up nearly 19% so far this year, resulting in continued inflationary pressure across the globe.
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