Gold & Silver Eye Modest Gains Amid Disappointing Jobs Data


It was a relatively calm week in precious metals markets, as gold and silver spared investors from major price swings throughout most of the week. Investors were largely focused on debt ceiling deliberations in Congress, rising Treasury yields, and inflationary concerns. So far, the dollar has been the near-term benefactor, as investors gravitate to its relative stability. Given this, the dollar index hovered close to highs not seen since November of 2020, for most of the week.

October can be a volatile month on Wall Street as earnings data is released in the fall, often reveals shortcomings in forecasts for the year. Supply chain woes, and inflation concerns were among some of the factors that drove stocks downward to start the week. Tech stocks were hit especially hard on Monday, as the Nasdaq dropped by 2%.

To many, it seems odd that metals haven’t performed better, and have dropped in recent weeks with risk-off sentiment being driven by various factors. In fact, gold ended September down by more than 3% while silver was down by 4.3%. Rising yields and a stronger dollar have proven to be reliable detractors to bullion, at least in the near term.

Gold started this week close to $1,763 an ounce. The yellow metal would see some initial selling pressure, but would recover for a slight gain, and would reach $1,769.50 by Monday’s close. Silver would start the week closer to $22.67 as it traded sideways on Monday.

With various Fed officials giving addresses throughout the week, the economic calendar was relatively light until employment data on Thursday and Friday. In recent weeks, investors have relied heavily on jobs data to gauge economic growth.

On Wednesday, gold continued to grapple with the dollar index and firmer yields. The 30-year Treasury note jumped to its highest level since June, which meant gold would touch its weekly low of $1,746 on the same day. It seemed the bears would remain in control, while gold and silver both stayed in consolidation mode. Meanwhile, markets braced for jobs data.

On Thursday, lawmakers arrived at a short-term deal to increase the debt ceiling. Wall Street rallied upon this news, sending all three major indices to session highs, and out of the red for the week. Thursday also saw a drop in initial jobless claims, which also pressured metals.

Friday’s Nonfarm payrolls showed that U.S. employers added 194,000 jobs vs. the 500,000 that was forecasted. Stocks were mixed after the disappointing payroll data, but metals would get a boost. Silver jumped almost 3% and is currently above $23. Gold briefly touched its weekly high of $1,780 but is now closer to the $1,770 mark. This would mean a modest gain for gold, and a 1.5% gain for silver.

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