Last Friday, the USD sharply fell down after the release of the US NFPR for April, which was below expectations. The number of jobs outside agricultural sector fell by 160 000 in April against the forecast of +200 000 and the rise of 208 000 in March. Unemployment rate remained at the level of 5.0%.
However, later on this day the situation had changed and at the closing session the USD was in the positive area in major pair with the USD. It is likely that the USD was supported by the news that hourly wages in the US private sector have increased by 2.5% against the same period a year ago. The price of gold has grown last Friday after the release of the US labor market data. June futures at COMEX closed up at the level of 1294.00 USD per ounce, rising by 1.7%.
In Q1 the price of gold has grown by 16.5%, which is the highest rise in the last three decades. However, since the opening of today’s trading day the USD has been rising in the currency market. The pair XAU/USD also continues to rise.
It seems that market participants believe that the moderate rise in wages will allow the US Fed to continue monetary policy tightening in the country.
Low interest rate maintains high level of gold, which reduces investors’ interest on profit. During the periods of the increase in the interest rates the price of gold goes down as its purchasing price and the costs of storage are increasing.
It is likely that the price of gold will maintain the level of 1280.00 USD per ounce until the next meeting of the US Fed on 14-15 June.