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Gold Prices Holding Gains Following Strong ADP Employment Numbers

Neils Christensen  

(Kitco News) -Economic data is having little impact on the gold market after private-payrolls processor ADP reported stronger-than-expected private-sector job growth last month.

Wednesday, ADP said that 241,000 jobs were created in March. The report beat estimates as consensus forecasts were looking for gains of 203,000 jobs. Along with last month’s impressive job gains, February’s numbers were revised higher to 246,000 jobs, up from the initial estimate of 235,000.

Gold was seeing positive gains ahead of the report, benefiting from volatile global equity markets and a weaker U.S. dollar. The yellow metal adding to its recent gains. June gold futures last traded at $1,347.90 an ounce, up 0.79% on the day.

According to commodity analysts, U.S. economic data is taking a backseat to growing geopolitical turmoil and an escalating trade war between China and the U.S. Overnight China imposed tariffs on key U.S. imports including soybeans, planes, cars, beef and chemicals.

Along with the stronger-than-expected headline number, the report noted strong across the board gains in all sectors of the economy.

While the ADP employment report will create some upside potential ahead of Friday’s nonfarm payrolls report, many economists still note that the data is not a consistent predictor of the government’s official numbers.

“While stronger than expected, we're not changing our forecast for a below-consensus print in headline payrolls on Friday as a result,” said Andrew Grantham, senior economist at CIBC World Markets. “Over the past 12 months the average absolute difference between the two series on first release has been around 70K. As such this should not be seen as an indicator that Friday's employment data will also be strong.

Commodity analysts have also warned that investors need to pay attention to the wage data as much as the headline employment number. The U.S. has seen lackluster wage growth, which is keeping inflation in check and the Federal Reserve from aggressively raising interest rates, which is positive for the gold market.

Gold Prices Holding Gains Following Strong ADP Employment Numbers

Kitco News

(Kitco News) -Economic data is having little impact on the gold market after private-payrolls processor ADP reported stronger-than-expected private-sector job growth last month.

Wednesday, ADP said that 241,000 jobs were created in March. The report beat estimates as consensus forecasts were looking for gains of 203,000 jobs. Along with last month’s impressive job gains, February’s numbers were revised higher to 246,000 jobs, up from the initial estimate of 235,000.

Gold was seeing positive gains ahead of the report, benefiting from volatile global equity markets and a weaker U.S. dollar. The yellow metal adding to its recent gains. June gold futures last traded at $1,347.90 an ounce, up 0.79% on the day.

According to commodity analysts, U.S. economic data is taking a backseat to growing geopolitical turmoil and an escalating trade war between China and the U.S. Overnight China imposed tariffs on key U.S. imports including soybeans, planes, cars, beef and chemicals.

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Along with the stronger-than-expected headline number, the report noted strong across the board gains in all sectors of the economy.

While the ADP employment report will create some upside potential ahead of Friday’s nonfarm payrolls report, many economists still note that the data is not a consistent predictor of the government’s official numbers.

“While stronger than expected, we're not changing our forecast for a below-consensus print in headline payrolls on Friday as a result,” said Andrew Grantham, senior economist at CIBC World Markets. “Over the past 12 months the average absolute difference between the two series on first release has been around 70K. As such this should not be seen as an indicator that Friday's employment data will also be strong.

Commodity analysts have also warned that investors need to pay attention to the wage data as much as the headline employment number. The U.S. has seen lackluster wage growth, which is keeping inflation in check and the Federal Reserve from aggressively raising interest rates, which is positive for the gold market.


      ADP National Employment Report: Private Sector Employment Increased by 241,000 Jobs in March

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