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Gold Slides amid Flat US Dollar, Strong Jobs Report

March 12, 2018 at 16:51 by Andrew Moran

Gold futures are trading lower to start the trading week. The yellow metal is in the red in the fallout of last week’s impressive US jobs report, but this could not give the US dollar any momentum on Monday.

April gold futures slipped $5.30, or 0.40%, to $1,318.70 per ounce at 16:32 GMT on Monday. Gold recorded a tepid weekly loss of 0.2% last week as traders believe inflation is tamer than first anticipated last month.

Silver, the sister commodity to gold, is taking a nosedive to kick off a week of trading. May silver futures tumbled $0.133, or 0.80%, to $16.47 an ounce. The white metal reported a modest weekly gain of 0.55% last week.

Precious metals were affected by strong labor numbers in February as the US economy added 313,000 jobs, defeating original forecasts of 200,000. The Bureau of Labor Statistics (BLS) did also find that hourly wages climbed just four cents to $26.75 per hour, and the 12-month increase in income slid 2.8%.

This has investors anticipating that inflation is not as aggressive as initially estimated, and this may not bode well for metal commodities. The paucity of inflation worries could also impact the Federal Reserve and how it moves on interest rates this year.

Investors will be looking to the latest consumer-price index (CPI) figures on Tuesday. Analysts say that the CPI could rise above the US central bank’s 2% target range. This could dominate the next Federal Open Market Committee (FOMC) meeting.

With traders fearing a global trade war, the US dollar is trading relatively flat as the greenback slid just 0.07% to 90.02. The greenback posted a weekly gain of 0.09% last week, but it is down more than 2% year-to-date. Gold and the US dollar generally trade inversely as the strength or weakness of the currency can influence demand among foreign gold buyers.

Other metals are falling on Monday. May copper futures were flat at $3.13 per pound. May platinum futures dipped $4.50, or 0.47%, to $959.70 an ounce. May palladium futures dropped $15.85, or 1.61%, to $971.0 an ounce.

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