Gold Futures Settle Higher As Dollar Weakens After Jobs Data

Gold futures settled higher on Friday as the dollar fell sharply after data showed a smaller than expected increase in U.S. non-farm payroll employment in the month of June.

The dollar index dropped to 102.23, losing more than 0.9%.

Gold futures for August ended higher by $17.10 or about 0.9% at $1,932.50 an ounce. Gold futures gained 0.2% in the week.

Silver futures for September ended $0.399 up at $23.289 an ounce, while Copper futures for September settled at $3.7820 per pound, gaining $0.0475.

Data from the Labor Department showed non-farm payroll employment jumped by 209,000 jobs in June, while economists had expected employment to shoot up by 225,000 jobs.

The report also showed the surges in employment in April and May were downwardly revised to 217,000 jobs and 306,000 jobs, respectively, reflecting a combined downward revision of 110,000.

While the Federal Reserve is still widely expected to raise interest rates by another quarter point later this month, the data has led to renewed optimism that will be the end of the central bank’s rate-hiking cycle.

Chris Low, Chief Economist at FHN Financial, said the smaller than expected increase in jobs combined with the downward revision to the two previous session suggest the job growth trend is gradually cooling.

“The Fed should be quite pleased with this,” Low said. “Job growth of 209k is still too much given their goal is a rising unemployment rate, but the FOMC is always happiest when the data show progress in their desired direction.”

He added, “In a sense, this is the best possible jobs report, then, threading the needle between too strong and too weak.”

Source: Read Full Article