Gold Extends Declines as U.S. Payrolls Rise More Than Expectedby
Gold futures extended declines after the U.S. economy added more jobs in December than forecast, reducing demand for the metal as a store of value after China growth concerns roiled markets this week.
The 292,000 gain in payrolls exceeded the highest forecast in a Bloomberg survey and followed a 252,000 increase in November that was stronger than previously estimated, a Labor Department report showed Friday. The median forecast in a Bloomberg survey called for a 200,000 advance. The jobless rate held at 5 percent, and wage growth rose less than forecast from a year earlier.
The precious metal capped a third straight annual loss in 2015 as signs of a strengthening U.S. economy prompted the Federal Reserve to tighten monetary policy. Higher rates cut the appeal of the metal because it doesn’t pay interest or offer returns like competing assets. Richmond Fed President Jeffrey Lacker said this week that the Fed will be watching developments in China “closely.”
Gold futures for February delivery fell 1.3 percent to $1,093.30 an ounce at 8:33 a.m. on the Comex in New York.