Gold lost half a percent on Monday, on course for its sharpest one-day loss in three weeks as a surprisingly upbeat US job market report dented the precious metal's appeal as a hedge against inflation.
The US unemployment rate unexpectedly dropped to a near four-year low of 7.8 percent in September, raising some doubts on whether the stimulus measures put in place by the Federal Reserve to boost the labour market would last as long as initially thought.
Rampant cash printing as a result of easy monetary policy drives investors to bullion to hedge risks arising from an increased inflation outlook. Gold jumped nearly 5 percent last month, during which the Fed and European Central Bank each announced aggressive easing measures.
Brent crude slipped below $112 per barrel on Monday, dropping for a second straight session on concerns a fragile global economy could curb oil demand, but supply worries stemming from tensions in the Middle East may help check losses.
The World Bank cut on Monday its economic growth forecasts for the East Asia and Pacific region, home to two of the world's largest oil consumers, and said there was a risk the slowdown in China could get worse and last longer than expected.
Concerns about Europe persisted with the region's largest economy Germany posting a drop in industrial orders in August, while a firm dollar after a surprise drop in the US jobless rate also curbed oil prices. A stronger dollar makes commodities priced in the greenback more expensive for holders of other currencies.
Iran has arrested the decline in its oil exports, boosting sales recently to countries including South Korea and Turkey just as US and European sanctions show signs of inflicting economic damage to Tehran.
Iranian oil exports hit a low in July of less than 1m barrels a day, but they increased slightly in August and more significantly in September, hitting 1.2m barrels per day, according to traders who monitor the sales.
“We have seen the low point of Iranian oil exports,” a Gulf-based senior oil official said. “Asian countries are buying again."
Egyptian President Mohammad Morsi sought to reassure conservatives at home that a request for a loan of nearly $5 billion in aid from the IMF would be compatible with Islamic banking principles.
Egypt asked for a $4.8 billion loan in August from the International Monetary Fund, which in turn urged economic reforms.
“This does not constitute Riba” the Egyptian president said, in reference to abusive interest rates as defined by Islamic jurisprudence.
International Monetary Fund forecasts that Saudi Arabia’s budget surpluses will gradually decline before dropping into deficit by 2016 are a “doomsday scenario”, the Kingdom’s Finance Minister Ibrahim Alassaf has said.
The world’s top oil exporter has run large budget surpluses since 2009 but the IMF said in a report last month that falling energy prices would hurt the Kingdom’s fiscal position.
“They have been working on scenarios assuming, I would say, a doomsday scenario which I don’t agree with. But we appreciate they are raising these issues in order to be ready,” he told reporters after a meeting with IMF managing director Christine Lagarde in Riyadh.
Kuwait transferred $250 million to the Central Bank of Jordan, the state-run Petra news agency reported, citing Finance Minister Suleiman Hafez.
The funds are Kuwait’s contribution to a $5 billion grant for Jordan that was endorsed by the Gulf Cooperation Council (GCC) last year.
At a GCC summit in December 2011, Saudi Arabia, the United Arab Emirates, Kuwait and Qatar agreed to extend $5bn over a five-year period to support development projects in Jordan, with each state contributing $1.25bn.
Iran has warned against consequences of Iraq's inspecting its airplanes bound for Syria, saying it will retaliate if it happens again.
"What Iraq did about inspection of airplanes bound for Syria is not proportional to the diplomatic ties of the two sides and is contradictory to security agreements and air transportation treaty of the two countries," said Iran's ambassador to Baghdad, Hassan Danaiefar.