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Gold falls as dollar rises after jobs data

joebb21joebb21 Posts: 4,746 ✭✭✭✭✭
in Precious Metals


NEW YORK -- Gold futures fell Friday, trading below $1,000 an ounce as the U.S. dollar rose after a disappointing jobs report, reducing gold's investment appeal. Gold for December delivery was last down $5, or 0.5%, at $995.70 an ounce on the Comex division of the New York Mercantile Exchange. The Labor Department reported that 263,000 payroll jobs were lost in September and the unemployment rate rose to a 26-year high of 9.8%. Economists expected a decline of 167,000 jobs...



can somebody please explain how more people can lose their job, and yet the dollar can rise? and gold as well falls? what appeals about the dollar now?
may the fonz be with you...always...

Comments

  • rgCoinGuyrgCoinGuy Posts: 7,478 ✭
    This is the year of the Opposite.
    imageQuid pro quo. Yes or no?
  • cohodkcohodk Posts: 19,109 ✭✭✭✭✭
    can somebody please explain how more people can lose their job, and yet the dollar can rise? and gold as well falls? what appeals about the dollar now

    The dollar rallies as, believe it or not, it is a flight to safety trade. With interest rates low in the USA and higher in emerging markets, investors are borrowing dollars at low interest rates and investing them in countries with higher rates. As long as it looks like the global economy is growing this trade will work. But when it looks as though the economy is not growing, as todays data suggests, that trade gets reversed and the dollar rebounds.

    As far as gold, if there is no growth, then it will be difficult for inflation to take root and hence gold loses its luster.

    Make sense?
    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • stockergreenstockergreen Posts: 483 ✭✭
    Could be a good time to buy gold and gold stocks on the dip?
  • mhammermanmhammerman Posts: 3,769 ✭✭✭
    "The Labor Department reported that 263,000 payroll jobs were lost in September and the unemployment rate rose to a 26-year high of 9.8%."

    While the actual number is quoted today as 17%. jobs Jobs data is not the whole picture.
  • renman95renman95 Posts: 7,037 ✭✭✭✭✭
    I see it's up $4 to 1,003.
  • RedTigerRedTiger Posts: 5,608 ✭
    The reported number often has no bearing on which way markets move. It is the expected number, vs. the actual number. That is one reason why analyzing pure fundamentals is not very useful for short term trading. Traders have already placed their money down based on their expectations, and the price before the report already reflects those expectations, and then moves based on how the report compares to those expectations.
    Investment blog: gold, stocks and more
  • KCCKCC Posts: 129


    << <i>can somebody please explain how more people can lose their job, and yet the dollar can rise? and gold as well falls? what appeals about the dollar now? >>



    Just speculating (no pun intended), but maybe because it's an indicator that inflation is not a problem?
    -Ken
  • ebaytraderebaytrader Posts: 3,312 ✭✭✭


    << <i>can somebody please explain how more people can lose their job, and yet the dollar can rise? and gold as well falls? what appeals about the dollar now

    The dollar rallies as, believe it or not, it is a flight to safety trade. With interest rates low in the USA and higher in emerging markets, investors are borrowing dollars at low interest rates and investing them in countries with higher rates. As long as it looks like the global economy is growing this trade will work. But when it looks as though the economy is not growing, as todays data suggests, that trade gets reversed and the dollar rebounds.

    As far as gold, if there is no growth, then it will be difficult for inflation to take root and hence gold loses its luster.

    Make sense? >>




    This is the correct answer.
  • yellowkidyellowkid Posts: 5,486 ✭
    Easy, the PM world can sometimes be "Bizarro" world.image
  • 57loaded57loaded Posts: 4,967 ✭✭✭


    << <i>can somebody please explain how more people can lose their job, and yet the dollar can rise? and gold as well falls? what appeals about the dollar now

    The dollar rallies as, believe it or not, it is a flight to safety trade. With interest rates low in the USA and higher in emerging markets, investors are borrowing dollars at low interest rates and investing them in countries with higher rates. As long as it looks like the global economy is growing this trade will work. But when it looks as though the economy is not growing, as todays data suggests, that trade gets reversed and the dollar rebounds.

    As far as gold, if there is no growth, then it will be difficult for inflation to take root and hence gold loses its luster.

    Make sense? >>



    to me it does, even though gold did rally late

    it seems that one needs to be on the trigger when info is released already knowing the short term scenario
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