Gold Rallies on Jobs Data

Gold Rallies on Jobs Data

Gold rallied this morning on disappointing jobs data. The yellow metal rose $5+ an ounce to $1,775 when the release of the key U.S. jobs report for November showed just 210,000 jobs created. Gold remained under pressure because of hawkish statements this week by Federal Reserve officials.

The Labor Department’s monthly payrolls report of 210,000 jobs is a big miss from economists’ estimates of 573,000. However, this is not the only economic snapshot. Gold slipped a bit once analysts dug further into the morning’s data. The survey of households painted a rosier jobs picture, indicating an employment gain of 594,000 for the month.

February gold futures fell 1.2% Thursday to settle at $1,762.70 an ounce on Comex. The front-month contract dropped 1.4% in the first four days of the week. Gold decreased 0.4% in November after advancing 1.5% in October. The yellow metal is down 7% so far in 2021. The February contract is up $10.40 (+0.59%) an ounce to $1,773.10 and the DG spot price is $1,773.90.

Prices fell Thursday after Fed policymakers increasingly signaled that the central bank would roll back bond purchases it started to prop up the economy during the pandemic faster than previously anticipated.

Atlanta Fed President Raphael Bostic told a Reuters conference that it would be appropriate to end the bond buying by the end of March — rather than June — to combat rising inflation. Fed Chairman Jerome Powell indicated Tuesday that soaring inflation was unlikely to be temporary and said that central bank policymakers would discuss tapering monthly bond purchases “a few months sooner” than anticipated.

San Francisco Fed President Mary Daly said Thursday that the Fed has to deal with rising inflation. She and Richmond Fed President Thomas Barkin spoke at a Peterson Institute for Economics event. Barkin said he’s “supportive of normalizing policy as we’re doing.”

In addition to the jobs report, investors were awaiting releases on U.S. factory orders and durable goods on Friday.

Earlier this week, ADP reported that private payrolls jumped by 534,000 in November, beating economists’ estimates of 506,000. U.S. manufacturing rose in November, amid new orders and increased factory production and hiring, according to data from the Institute for Supply Management.

In addition to inflation, fears about the spread of the new omicron variant of the coronavirus continued to influence investors, keeping a floor under gold prices because of the yellow metal’s traditional role as a hedge against uncertainty.

March silver futures decreased 0.1% Thursday to settle at $22.32 an ounce on Comex. The front-month contract lost 3.5% in the first four days of the week. Silver fell 4.7% in November after rising 8.6% in October. The metal is down 16% so far this year. Silver prices are tied to industrial demand. March contract is up $0.059 (+0.26) an ounce ot $22.375 and the DG spot price is $22.43.

Spot palladium rose 1.4% Thursday to $1,790.00 an ounce and gained 0.9% so far this week. It plummeted 13% in November after rallying 4.3% in October. It’s down 27% so far in 2021. Currently, the DG spot price is up $37.60 an ounce to $1,829.00.

Spot platinum decreased 0.5% Thursday to $944.40 an ounce and fell 1.8% in the first four days of this week. The metal dropped 8.1% last month after rising 6% in October. It’s down 12% so far this year. The DG spot price is up $1.40 an ounce to $948.60.


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