Gold posted a slight loss on Friday but retained the majority of its weekly rally. The negative close was the first in five for the precious metal as better-than-expected employment data reduced the need for a safety investment.
June-dated gold fell to $914.90, down 60 cents on the session. Prices earlier touched as high as $921.00.
Gold finished the week up $27.30 as the dollar fell versus other major currencies. The metal posted its second weekly gain in three after declining four straight weeks.
The dollar plummeted versus the euro again on Friday, dropping to a six-week low and continuing a 2 1/2-week downtrend. The greenback also fell to a four-month low against the sterling. Gold often moves opposite the dollar because of the precious metal because of its hedge value.
On the economic front, the Labor Department report showed that non-farm payroll employment fell by 539,000 jobs in April following a revised decrease of 699,000 jobs in March. Economists had expected a decrease of about 600,000 jobs compared to the decrease of 663,000 originally reported for the previous month.
At the same time, the Labor Department said that the unemployment rate rose to 8.9 percent in April from 8.5 percent in March. The increase, which lifted the unemployment rate to a new 25-year high, came in line with economist estimates.
In other economic news, the Commerce Department said wholesale inventories fell 1.6 percent in March following a revised 1.7 percent decrease in February. Economists expected a 1.0 percent decline.
Traders also had their first chance to react to the official results of the U.S. government's stress tests of the nation's 19 largest financial institutions, which were released late Thursday afternoon. The showed that 10 of the 19 banks tested need to raise a total of $74.6 billion. The banks involved in the exercise account for two-thirds of the assets and more than half of the loans in the U.S. banking system.
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