Gold Price Drops After Upbeat US Jobs Number
New York (Aug 4) Gold prices are lower in early U.S. trading Friday, pressured by an upbeat U.S. employment report that falls into the camp of the U.S. monetary policy hawks. December Comex gold was last down $7.00 an ounce at $1,267.20. September Comex silver was last down $0.07 at $16.56 an ounce.
The just-released July U.S. employment report from the Labor Department showed a rise of 209,000 non-farm jobs. Forecasts had called for the payrolls number to come in at up 180,000. The hourly wage component of the July jobs report was up 0.34%, which was a bit higher than expectations. A lower-than-expected wage inflation reading would have prompted ideas of still-very-low inflation pressures.
The U.S. dollar index rallied following the jobs report, which is a bearish daily element for the precious metals markets. The index earlier this week hit a 13-month low. Still, the overall present postures of the dollar index and the Euro currency are bullish for the precious metals markets (dollar index in a downtrend and Euro in an uptrend).
U.S. stock indexes rallied modestly on the jobs data, while U.S. T-Bonds and T-Notes futures markets sold off moderately.
Nymex crude oil futures are lower in early trading Friday and trading around $48.50 a barrel. Oil market watchers are looking ahead to next week’s OPEC meeting in Abu Dhabi. Many believe some OPEC members are cheating on their production quotas, and the meeting will address that matter.
Other U.S. economic data due for release Friday includes the international trade report.
Live 24 hours gold chart [Kitco Inc.]
Technically, December gold futures bulls still have the overall near-term technical advantage amid a near-term price uptrend. Bulls’ next upside technical objective is pushing prices above chart resistance at the $1,300.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at last week’s low of $1,249.40.
By 10:00am EST spot gold was alredy down $12 to $1,256, while spot silver plunged more than 2% to $16.30.
Reuters
