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US Nonfarm Payrolls Help Gold, Hurt Crude Oil

August 2, 2013 at 15:58 by Vladimir Vyun

Gold rose today as US nonfarm payrolls disappointed market participants, easing fears of possible tampering of monetary stimulus by the Federal Reserve. Employment increased by 162,000 in July, compared to the forecast of 184,000. At the same time, the unemployment rate was down by 0.2 percentage point to 7.4 percent.

By the same token crude oil declined on the signs of economic weakness. It is interesting to see how different commodities react in total opposite ways to the same event. One can see how hard it is to predict price moves as market reaction can be quite puzzling.

September futures for delivery of WTI crude oil slipped as much as $1.32 (1.22 percent) to $106.57 per barrel on NYMEX today. Contract for Brent crude lost $0.88 (0.8 percent) to $108.66 per barrel on ICE. Meanwhile, December futures for gold added $1.7 (0.13 percent) to $1,312.9 per troy ounce on COMEX.

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