Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold fell 1.1% to close under $1,851 after solid US jobs data rekindled expectations for higher interest, lifting yields and the dollar while pressuring alternative assets. The metal slid 0.3% on the week.

US nonfarm payrolls added 390,000 jobs in May, exceeding forecasts and signaling underlying momentum in the labor market despite some slowing in the economy. The unemployment rete remained unchanged at 3.6% and hourly wages rose by 0.3%.

While the smallest in 13 months, the increase was still enough to heighten speculation that the Fed will continue with aggressive monetary tightening over its next several meetings. Fed Chair Jerome Powell had recently floated the idea of pausing rate hikes this fall to prevent tipping the economy toward recession.

On that score, the ISM reported that the massive US services sector expanded in May at its slowest pace since February 2021. Service industries like banking, hospitals, and retailers comprise more than two-thirds of the economy.

Benchmark 10-year Treasury yields rose back above 2.95% after the jobs data, pressuring gold by increasing the opportunity cost for holding instead of bonds as a safe-haven asset.

The dollar also rebounded, adding 0.4% against major rivals on the more hawkish rate view. Rising rates lift the dollar by attracting Forex investors seeking higher yield, pressuring gold and other commodities by making the pricier in other currencies.

The other precious metals were also lower. Silver lost 1.7%, sliding into a weekly loss of 0.8%, while platinum and palladium fell 1.2% and 3.5%, respectively.

At the Comex close: August gold fell $21.20 to $1,850.40; July silver slid 37 cents to $21.91; July platinum dropped $12 to $1,016.40; and September palladium lost $61.60 to $1,985.90 an ounce.