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Gold Pares Losses after US Labor Data Disappoints

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The popular spot gold futures contract was up a bit during the Asian trade session as it trimmed some of the losses seen during the North American trade session after the ADP jobs report showed a record setting number of job losses in the United States for the month of April.

As of 12:45 am GMT, the spot gold futures contract was up 0.4 percent to trade at $1,691.98 per ounce.

The U.S. gold futures contract, for front end delivery, added 0.4 percent, as well, to fetch $1,695.60 per ounce.

Asian traders were monitoring weaker than expected services purchasing managers’ index (PMI) out of China for the month of April.

Limiting the yellow metal’s gains was the strength of the U.S. dollar which was trading near a one week high price point.

Gold Traders Digest Record Setting U.S. Job Losses

Overnight the private ADP non-farm payroll change was released. This is the precursor to Friday’s all-watched non-farm payroll report for the Month of April.

April’s ADP labor report showed that the U.S. economy shed a record 20.2 million jobs.  This is labor data ending 12 April. Today, the United States will release weekly unemployment claims for the week ending 1 May.

The Bank of England (BOE) is also on the schedule today. The British central bank will announce their monetary policy and rate decision during the European trade session. There is also German and French monthly industrial production data on the schedule as well as monthly Italian retail sales.

Traders Shrug off Poor China’s Services PMI Data

The mainland stock exchanges, in China, were mixed during the morning. The Shanghai composite lost 0.24 percent and the Shenzhen composite rose about 0.10 percent.

China’s Caixin/Markit services Purchasing Managers’ Index for April was released today. Services activity in the world’s second largest economy contracted for the third month in a row. Layoffs were at a record high as this number printed at 44.4. While above the 43 print, for March, the services PMI remains below the contraction level which is at fifty (50).

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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