Gold Prices Holding Recent Gains As 134K Jobs Created In U.S. In September, Missing Expectations
(Kitco News)- Gold prices are holding relatively steady, hovering above thepsychological level of $1,200 an ounce as the U.S. labor market showed a mixedpicture last month.
The Bureau of Labor Statistics said 134,000 jobs were created inSeptember, economists were expecting to see job gains of around 185,000. While the data came in weaker than expected, thereport noted higher revision in July and August. July's numbers were revised upto 165,000 jobs from the previous estimate of 147,000; at the same time August'sjob number was revised up to 270,000 from the initial estimate of 201,000.
Some economist have dismissed weakness in the employment numbers,saying the data was impacted by Hurricane Florence, which hit the east coast inmid-September.
At the same time the unemployment rate came in at 3.7%, down significantlyfrom August. The data beat expectations as economists forecasted a drop to3.8%. Analysts noted that this is the lowest unemployment rate since 1969.
Gold prices were modestly higher ahead of the report and havemanaged to hold on to gains as the market sees little movement in initialreaction. Spot gold last traded at $1,201.90 an ounce, up 0.18%% onthe day.
Along with the headline employment data, markets are closelywatching wage numbers, which increased last month in line with expectations. Thereport said that average hourly wages increased by 8 cents to $27.24. In the last12 months wages increased 2.8%.
Andrew Grantham, senior economist at CIBC described September’semployment report as “solid,” despite the weaker than expected headline number.
“Today's results are still consistent with a strong US economy andgradually accelerating inflationary pressures,” he said. “Wage growth, whichpicked up in the prior month, came in line with expectations with hourlyearnings rising 0.3% on the month for an annual rate of 2.8%. While that annualrate is a tick lower than the prior month, there is a soft monthly printfalling out of the calculation next month and as such wage growth could soonbreak above 3% for the first time.”
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