Gold and silver are feeling selling pressure early on Monday despite both metals having recorded gains to close out last week. After investors were greeted with a weaker than expected employment report for March on Friday, demand for gold and silver rose in conjunction with spot values almost immediately. Though the numbers did not fall too far below market expectations, the fact that payroll growth fell below expectations after the chairperson of the Federal Reserve just recently spoke about the strength of job growth in the United States was unnerving to some.
As opposed to last week, this 5-day trading session is not expected to have nearly as much economic data on the table. Instead, the market will focus on the words of high-ranking Fed members and more closely focus on the price action of both US equities and the US Dollar.
Gold and Silver Post Gains Thanks to Weaker Employment Report
Prior to last week’s release of the non-farm payrolls data from March, investors were extremely optimistic about what the report might show as far as job growth is concerned. Adding to this sense of optimism was recently positive remarks from high-ranking members of the Fed about their feelings on job growth over the long term. When Friday rolled around, however, that optimism was quickly dealt a dose reality due to the payrolls figures coming in short of what the market had been expecting. Compared to expectations of nearly 210,000 new payrolls added to the US economy in March, the report showed that instead only about 192,000 new payrolls were added.
Normally, this small disparity would not be enough to spark renewed interest in precious metals, but after comments from Janet Yellen and James Bullard with regard to the growing strength of the US economy it was more than enough to scare a few investors. Now, on Monday, profit-taking after Friday’s gains has taken center stage, driving the spot values of both gold and silver downward to below $1,300 and $20 threshold respectively.
US economic data due to be released on Monday is not of any great significance and will likely be overlooked by the wider investing community. Instead, investors are preparing for speeches scheduled to be made by president of the Fed bank in St, Louis, James Bullard, as well as one by the president of the Chicago Fed bank, Charles Evans. Thanks to last week’s sub-par employment report, European and Asian equities were also dealt a blow which means that these two men will be speaking to an audience that consists of more than solely US citizens.