Gold price (XAU/USD) delivers V-shape recovery despite the United States Nonfarm Payrolls (NFP) report for September has reported that the number of job-seekers hired were significantly higher than expectations. Fresh payrolls were 336K while investors forecasted that US employers added 170K employees and 187K jobs were created in August. Weak Employment numbers from Automatic Data Processing (ADP) also elevated expectations of a decline in labor demand. The Unemployment Rate remained steady at 3.8% but a tick higher than expectations of 3.7%. On a monthly basis, the Average Hourly Earnings grew at a steady pace of 0.2% while investors anticipated the growth in wage momentum by 0.3%. The annual wages softened marginally to 4.2% against estimates and the former release of 4.3%. Resilient labor market conditions have set a hawkish undertone for the Federal Reserve’s (Fed) upcoming monetary policy decision in November.
Robust labor demand Nonfarm is expected to intensify selling pressure in the US Treasuries and would weaken the appeal for Gold. Apart from that, expectations of one more interest rate increase from the Fed in the remainder of 2023 would deepen. This is expected to discomfort Fed policymakers and spur consumer inflation expectations. Gold price discovers buying interest after dropping to near $1,810 as investors ignore the release of the better-than-anticipated NFP report. A death cross, represented by the 50-day and 200-day Exponential Moving Averages (EMAs) at $1,905.00, warrants more downside. Momentum oscillators have turned extremely oversold. Gold price discovers buying interest after dropping to near $1,810 as investors ignore the release of the better-than-anticipated NFP report. A death cross, represented by the 50-day and 200-day Exponential Moving Averages (EMAs) at $1,905.00, warrants more downside. Momentum oscillators have turned extremely oversold.
