Gold prices slipped after the blockbuster US jobs report was little different from forecast, prompting a jolt in the dollar and an overall drop in precious metals complex on expectations that the Fed will raise rates from next month.
Gold for December delivery on the Comex division of the New York Mercantile Exchange fell $6.50 or 0.6 percent to $1,083.60 per ounce. Before the release of the labour data, the yellow metal was trading around $1,091.90.
The US added 215,000 non-farm jobs in July, just below the forecast of 220,000. The unemployment rate was steady at 5.3 percent, while average hourly earnings grew 0.2 percent month-on-month, in line with expectations.
The US economy has now added jobs for 65 straight months. The data point is one of the last key labour indicators that the Federal Reserve can use to gauge the status of the US economy before deciding whether to raise rates in September.
“Attention on the gold market is likely to be focused today on the US labour market figures for July,” Commerzbank said. “The Fed Fund Futures are currently pricing in a roughly 50 percent probability of a Fed rate hike in September.”
US interest rates have fallen precipitously since 2006 and a rate increase would signal to market participants that the Fed is seeing enough growth to ignore a lack of inflation.
In other data today, German industrial production at -1.4 percent was well short of consensus of 0.3 percent, with the French figure at -0.1 percent. The German trade balance at 22.0 billion euros was also short of expectations, though the French figure was somewhat better than expected at -2.7 billion euros.
Turning to wider markets, Germany’s DAX and France’s CAC-40 were each down 0.3 percent, while the dollar was 0.4 percent stronger at 1.0881 against the euro.
In the other precious metals, Comex silver for September settlement dropped 6.7 cents to $14.610 per ounce. Trade has ranged from $14.565 to $14.790.
Platinum for October delivery dipped $7.10 to $948.90 per ounce, while the most actively traded palladium contract was at $598.40 per ounce, down $1.40.
(Editing by Mark Shaw)
The post Gold dips, US economy adds jobs for 65th straight month appeared first on The Bullion Desk.
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