Precious Metals Hammered After U.S. Jobs Report: Gold, Silver Down 2%; Platinum Down Nearly 4%

New York (July 5)  The precious metals sector tumbled on Friday following strong U.S. jobs numbers with gold and silver down 2% on the day and platinum down nearly 4% on the day.

August Comex gold was last at $1,389.20, down 2.23% on the day, September Comex silver was last at $14.98, down 2.32%, and October platinum was last at $812.00, down 3.76%.

U.S. payrolls rose by 224,000 in June, according to the Bureau of Labor Statistics. The monthly figure beat market expectations of 160,000 new positions.

The U.S. unemployment rate edged up to 3.7% from 3.6% in June. Meanwhile, wages, another key element in the report, were unchanged at 3.1%.

The precious metals were largely reacting to market’s re-pricing of expectations when it comes to the Federal Reserve rate cut at the July meeting.

“With the unemployment rate slightly up at 3.7% and average earnings disappointing … the jobs data is certainly a mixed bag. Today’s report is likely to complicate the Federal Reserve’s decision to cut interest rates this month, especially if economic conditions in the United States continue to stabilize leading up to the Fed policy meeting,” said FXTM research analyst Lukman Otunuga.

In response, the U.S. dollar jumped on Friday with the DXY last trading at 97.30, up 0.60% on the day.

“This sentiment is reflected in the Dollar’s appreciation with further upside expected as investors start to re-evaluate whether the Fed will pull the rate cut trigger. A weekly close above 97.00 may inspire an incline towards 97.50,” Otunuga added.

KitcoNews