Gold consolidates ahead of key week, bid following poor NFP outcome

• Gold starts out the week consolidating following NFP disappointment. 
• Iran/US de-escalation/conflict moves to the backburners, trade comes back to the fore. 

Gold is consolidating around $1,558/61 at the start of the week following a slight pick up from the 200-hour moving average after US Nonfarm Payrolls disappointed on Friday. 

On Friday, the US December non-farm payrolls rose 145k versus market expectations of 160k and the Nov gain was pared back to 256k from 266k. Moreover, the average hourly earnings were a disappointment at 2.9% yoy (est. 3.1% yoy) and there was a very mild lowering in the average workweek to 34.3 hours. This knocked the dollar off its perch and subsequently drove a bid into gold. 

Gold had otherwise been on the back foot following a de-escalation of the US/Iran conflict and while investors take profits ahead of a busy schedule ahead. TD Securities continues to expect that precious metals are in the "early stages of a bull market, as the Fed continues to suppress real rates, while safe assets remain in short supply."

Central banks will come back into focus soon after the US and China sign the phase-one deal this week – more on that here: What you need to know for the open: Positive noises on trade to counter Persian Gulf conflict risks

The week ahead

• 13th Jan: Bank of Canada Business Outlook Survey, UK GDP.
• 14th Jan: US Consumer Price Index, NZIER Business Opinion Survey (Q4), China Trade data. 
• 15th Jan The signing of US/China phase-one trade deal to take place in Washington, with a high-level delegation from China attending.
• 16th Jan: US Retail Sales.

Gold levels