How Will Gold Price React To The Robust US October Jobs Number?

After scaling to record highs in the previous year, gold is down almost 15 percent or Rs. 8751 considering the all time high of Rs. 56,200 on the MCX. Now as there are a host of factors impacting gold prices and particularly the bearing of the US dollar index movement and bond yields, gold has been seeing respite and has once again climbed the key $1800 per ounce key psychological level.

The main factor supporting gold price as of now has been dollar index which due to ample liquidity into the global system as well as near zero interest rates has been losing ground. Last the dollar index hovered lower by 0.14% to end the session at 94.22. Likewise, there have been seen softening in the US bond yield which went down by 0.12 percent.

US jobs data to cause softening in gold price in the near term

As per the Labour department data released on Friday, there has been an improvement in the jobs number for the October month. The unemployment rate went down to 4.6 percent with non-farm payrolls gaining more than expected. There has been an exorbitant increase in the payroll number by 5.31 lakhs for the month as against 4.5 lakh estimated by the Dow Jones. Private payroll situation was even more robust

Now as jobs indicate the economic growth stance, the recent data will boast of a promising economic growth scenario. The sentiment shall revive risk-on sentiment and hence dent the appeal of the precious yellow metal going forward in the near term.

Nonetheless, a whole lot of reasons are suggesting gold will see positive rate trend going forward, the prime being the global central banks' continuation with the accommodative monetary policy stance in order to provide the best possible support.

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