Gold up on jobs report as the U.S. fails to hit market forecast for jobs in May. The yellow metal jumped almost $7 an ounce immediately and the most active futures month has now gained over $15 an ounce.
The U.S. added a modest 559,000 new jobs in May, below the market forecast of 671,000 jobs. The number is being blamed on labor shortages that could hold back the economy’s recovery. On a positive note, the nation’s unemployment rate fell from 6.1% in April to 5.8% in May — a pandemic low.
U.S. weekly initial jobless claims for last week fell to a pandemic-era low in data released Thursday. The positive news strengthened the dollar and U.S. Treasury yields, pressuring gold and silver — which fell to a three-month low. But inflationary concerns kept a floor under prices.
August gold futures fell 1.9% Thursday to settle at $1,873.30 an ounce on Comex. The front-month contract dropped 1.7% in the first four days of this week after advancing 7.8% last month. May was the best month for the precious metal since July. Gold gained 3% in April and dropped in January, February and March. Gold climbed $372 — or 24% — in 2020 because of uncertainty about the economy and the pandemic. Currently, the August contract is up $15.80 an ounce to $1,889.10 and the DG spot price is $1,890.60.
July silver futures plunged 2.6% Thursday to settle at $27.48 an ounce on Comex. The front-month contract retreated 1.9% in the first four days of this week after gaining 8.3% in May. Last month’s rally was the best monthly performance for silver since December. The metal increased 5.5% in April and dropped in February and March. It advanced 47% in 2020. This morning’s jobs report gave silver a lift as well. The July contract is currently up $0.388 an ounce to $27.865 and the DG spot price is $27.88.
In economic news, new applications for U.S. unemployment benefits dropped below 400,000 last week for the first time since March 2020. Claims dropped to 385,000, fewer than the 393,000 consensus estimate by Wall Street economists. The report was the latest positive economic news after U.S. manufacturing beat expectations for May amid burgeoning demand as the economy reopened following the worst of the pandemic.
The COVID-19 virus has killed about 3.7 million people worldwide and sickened around 172 million. About 19% of the cases — and 16% of the deaths — are in the U.S. The country has about 33.3 million cases, more than any other nation, though its proportion of both new cases and deaths has been declining as more Americans are vaccinated and other countries’ outbreaks worsen.
Many investors remain concerned about inflation stemming from central bank stimulus measures used to prop up the economy during the pandemic. Gold is a traditional hedge against inflation.
Spot palladium decreased 1.5% Thursday to $2,831.00 an ounce. It dropped 0.5% in the first four days of this week after losing 4.1% in May. It’s up 16% so far in 2021. The DG spot price is currently up $6.90 an ounce to $2,843.50.
Spot platinum fell 2.5% Thursday to $1,166.90 an ounce. Platinum decreased 1.7% so far this week after losing 1.5% in May. The autocatalyst metal is up 8.7% in 2021. The current DG spot price is up $1.10 an ounce to $1,170.60.
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