Gold rebounds as U.S. non-farm payrolls misses expectations

June 4, 2021

New York (Jun 4) - Gold rebounded from an over two-week low hit on Friday after a rise in U.S. non-farm payrolls fell short of expectations, although bullion was still on course to register its biggest weekly decline since March.

Spot gold jumped 0.9% to $1,886.80 per ounce by 9:43 a.m. EDT (1343 GMT), having hit its lowest since May 19 at $1,855.59 earlier. It was down 0.8% for the week so far.

U.S. gold futures gained 0.9% at $1,890.80.

“We’re seeing a modest rally in the wake of the slight miss on the non-farm payrolls ... more than a few market watchers were looking for a much bigger number and when that didn’t occur the gold market bulls kind of gave a sigh of relief,” said Kitco Metals senior analyst Jim Wyckoff.

“The rebound that we’ve seen today keeps the uptrend on the daily chart alive in the gold market, and that’s encouraging for the bulls.”

U.S. non-farm payrolls increased by 559,000 jobs last month versus 650,000 forecast in a Reuters poll.

The dollar index eased from a three-week high, making gold affordable for holders of other currencies, while benchmark 10-year yields also moved lower.

“Part of what we’re seeing in terms of the strength in gold are inflation expectations and those are partly based on the stronger economic data, like higher jobs growth, broader recovery in the U.S., parts of Europe and China is still doing well,” said Jeffrey Christian, managing partner of CPM Group.

“Gold prices will probably continue to trade between $1,855 and $1,920 an ounce levels.”

Gold is often viewed as a hedge against inflation.

Silver gained 1% to $27.71 per ounce and was on track for its biggest weekly fall since late March.

Palladium fell 0.2% to $2,833.49 and platinum was steady at $1,156.99.

Reuters

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