Gold pummelled as non-farms show above forecasts
London (Mar 6) Gold came under heavy pressure as the US non-farm payrolls number came in much better than forecast.
The US economy created 295,000 new jobs in February, against forecasts of 240,000 while the unemployment rate fell to 5.5%.
Jobs are key to the US Federal Reserve’s thinking on interest rates.
Comment from Fed chair Janet Yellen recently has increased expectations that US interest rates will go up in June and economists said that today’s very strong figures would add to the speculation.
The dollar rose again as soon as the figures were released to hit a new 12-year high against the euro. Other currencies also fell against the US currency.
Gold and the dollar traditionally move in the opposite direction and the strength of the dollar recently has weighed heavily on the metal.
Having risen by almost 10% at the end of January, gold is now back below the level seen at the end of 2014.
An hour into trading on Wall Street, the spot gold price was US$20 lower at US$1.177, with silver and platinum also seeing meaningful losses.