Gold gaps higher after dismal US jobs numbers and fresh Spanic

The raft of bad US economic numbers out this week that culminated in the terrible employment report this morning, combined with the stream of bad news emanating from Europe, saw the gold price jump more than $50 an ounce on Friday.

After falling to an intra-day low of $1,546 shortly after the open by 10:15am EST gold futures has shot up almost 4% to $1,619 in New York as traders bet that the much weaker than expected jobs numbers – the jobless rate actually creeped back up to 8.2% – would strengthen the hands of Fed doves who are calling for an extension of quantitative easing programs

Panic about Spain (which traders have dubbed 'Spanic') also increased after it was revealed that $100 billion – equal to 10% of the country's GDP – had been withdrawn from the Iberian nation's banks in the first three months of the year.

Spain's deputy prime minister met with US treasury secretary Tim Geithner on Friday discussing outside assistance for Spain's faltering banks.

Today's report is the final employment numbers the US Federal Reserve are able to take into account before June's meeting to decide on monetary policy direction.

Operation Twist, was announced in September that  pumped $400 billion into markets, expires this month. The program followed QE1 which began in December 2008 and QE2 when the Fed bought $2.3 trillion of bonds. Before QE1 an ounce of gold was worth $837.

Spot gold is trading flat for 2012 after an uninterrupted bull run of 11 years.

Read more about QE in the EU, Grexit and Operation Twist and the effect on the gold price here >> and here >>