Gold slips as October jobs beat forecasts, lifting rate outlook

The Labor Department also reported that unemployment fell to 4.1% from 4.2%, while average hourly earnings rose 0.4% on the month and 3.1% from a year earlier. September payroll growth was revised up by 31,000 to 60,000, and August’s was raised by 53,000 to 186,000, adding 84,000 jobs to the two months’ previously reported totals. Economists had expected about 65,000 new jobs in October.

Professional and business services added 70,000 positions, health care gained 42,000 and transportation and warehousing added 25,000. Manufacturing employment rose by 19,000. The labor-force participation rate held at 61.9%, and the average workweek remained 34.4 hours.

The report strengthened expectations for another Federal Reserve rate increase in December. Before its release, futures implied about a 70% chance of a 25-basis-point increase at the Fed’s Dec. 8-9 meeting. The two-year Treasury yield rose about 6 basis points to 4.53% after the data, and the dollar advanced, adding pressure to gold. The stronger hiring figures followed Thursday’s steep equity selloff, which had sent investors toward government bonds and pushed longer-term yields toward two-month lows.

Markets are also weighing inflation and geopolitical risks. October’s U.S. consumer price index is due Nov. 10, followed by the producer price index on Nov. 13. September consumer prices rose 0.6% from the prior month and 3.7% year over year, above the Fed’s 2% objective. Separately, reports of attacks on commercial vessels in and around the Strait of Hormuz have kept concerns over shipping and energy supplies alive. Iranian claims about specific tanker incidents have not been independently confirmed, and diplomatic proposals under review by Washington and Tehran have not produced a binding settlement.

In morning futures indications, WTI crude was around $90.40 a barrel and Brent near $98.20. Gold’s immediate technical support was identified at $4,051.45 and $4,021.95, with resistance at $4,088.51. For silver, support stood at $50.515 and $49.013, while resistance was at $53.107 and $54.617.