Gold prices were sharply lower following a better-than-expected nonfarm payrolls report for January. The yellow metal fell to $1,330/oz, down 1.4% (-$19).
The downturn was even bigger for silver. Spot silver lost 2.85% to $16.70/oz, down 50¢ per ounce.
Palladium pared earlier gains to trade near $1,035/oz. Platinum joined gold and silver in the red, slumping nearly 1.8% to $988/oz.
Strong NFP Provides Case for Optimism
Nonfarm payrolls were released on Friday morning and the results were far better than anticipated.
Hiring during January remained robust as the U.S. economy added 200,000 jobs during the month.
Private-sector employment showed particularly strong gains. However, NFP figures from several previous months were revised lower.
Another key takeaway from the payrolls data was improving wage growth.
The rise in wages during January registered at 2.9%, the best month since June of 2009. This reaffirms jobs data from the Labor Department earlier this week.
It remains to be seen if these gains will be durable enough to signal a sustained rise in inflation.
Still, it’s worth considering that 18 U.S. states raised their minimum wage to start 2018.
Dollar Trades Higher, Bitcoin Price Hits New Lows
Thanks to the unexpectedly good nonfarm payrolls, the dollar rose 0.75% on the DXY index to almost 89.33.
Accordingly, the stronger dollar dragged commodities lower, including the precious metals.
Brent crude oil fell 2% to $68.25 per barrel. The benchmark price is still up better than 50% from its lows in mid-June.
Meanwhile, WTI crude was down slightly less (-1.8%) to $64.60/bbl. According to the Energy Information Administration (EIA), U.S. oil output is exceeding 10 million barrels per day for the first time in 40 years.
Shale production is also accelerating, especially in oil-rich Texas.
In other news, the leading cryptocurrency bitcoin tumbled to a three-month low below $8,000 overnight.
$100 billion in market capitalization vanished as a result. Bitcoin has halved in price from just two weeks ago.
The significantly lower BTC price drew fresh buying pressure this morning, helping to cut some of the losses.
From a technical perspective, the digital token fell below several key support levels. This may spell a prolonged selloff.
Global Markets Off to Close Out the Week
Gains for the U.S. dollar also impacted foreign exchange markets.
The euro was down 0.75% against the dollar to just under $1.242. Britain’s pound sterling was also down 0.8% but held above $1.41. The yen tumbled 0.9% to ¥110.4 per USD.
Bonds were likewise hammered on Friday. 10-year Treasury yields jumped to 2.84%, roughly 10 basis points higher than yesterday morning.
Stock futures on Wall St extended their downward slide. The Dow Jones, S&P 500, and Nasdaq were each off by as much as 1% at the opening bell in New York.
Disappointing earnings for corporate behemoth Apple dragged indices lower. However, Amazon continued to impress investors and thus saw share prices rise.
Equities were more than 1% in the red across Europe but the FTSE 100 was about 0.5% lower. Stocks in Asia experienced choppy trading and ended the session mixed.
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