Gold Soars Most in Six Months Over Jobs data

Gold soared the most in six months after the U.S. jobless rate had the biggest gain in more than two decades, spurring a drop in the dollar.

The unemployment rate increased to 5.5 percent in May from 5 percent in April, marking the biggest increase since February 1986, the U.S. Labor Department said today. The dollar dropped as much as 1 percent against the euro. Gold has gained 33 percent in the past 12 months as a slump by the dollar boosted demand for the metal as an inflation hedge.

Gold futures for August delivery rose $23.50, or 2.7 percent, to $899 an ounce on the Comex division of the New York Mercantile Exchange. That marks the biggest gain for a most- active contract since Nov. 23.

The jump in the jobless rate was higher than every forecast in a Bloomberg survey of 79 economists, who had estimated a median gain to 5.1 percent. U.S. payrolls dropped by 49,000 last month after a 28,000 drop in April.

Gold may climb to $930 and silver will rise above $18 by mid-July, Sandeep Rungta, a metals strategist at Proficient Commodities in Kolkata, India, said in a report.