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Precious Metals Sank as NFP Beat Expectations

October 4, 2014 at 4:27 by Vladimir Vyun

Precious metals ended Friday with huge losses after positive US nonfarm payrolls surprised market participants. While good employment data was priced in, traders were still unprepared to how encouraging the actual report was.

US employment expanded by 248,000 jobs in September, exceeding the median forecast of 216,000. The unemployment rate unexpectedly fell from 6.1 percent to 5.9 percent. Separate report about the US trade balance was also better-than-expected.

Favorable economic indicators suggest that the Federal Reserve may start raising interest rates earlier, and such prospect is very negative for precious metals. Gold lost all its gains that it had acquired during this year. All-in-all, bears continue to dominate the market of precious metals.

December futures for delivery of bullion fell as much as 1.8 percent to settle at $1,192.90 per troy ounce on COMEX. Silver contract lost 1.3 percent to $16.83 per ounce. Palladium declined 1.8 percent to $754.55 per ounce on NYMEX, while January Platinum tumbled 3.4 percent to $1,226.90 per ounce.

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