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Gold price dips as U.S. private payrolls surprise with more jobs in June

Kitco News

(Kitco News) Gold edged down after private-payrolls processor ADP reported a better-than-expected increase in jobs this month.

Private payrolls rose by 692,000 in June, ADP said on Wednesday. Market forecasts were calling for an advance of 600,000. May's data was downwardly revised to an increase of 886,000 jobs.

In an initial reaction to the data, gold ticked down, with August Comex gold futures last trading at $1,756.60, down 0.40% on the day. 

Looking at the components of the report, most of the job increases were reported in the service-providing sector, which added 624,000 positions. Those were fairly evenly split between large companies, midsized, and small.

Large companies that employ 500 or more people saw 240,000 new jobs added in June. Midsized companies that employ up to 500 people saw an increase of 236,000. And small companies that employ up to 50 people reported adding 215,000 jobs.

The goods-producing sector saw a smaller increase of 68,000 payrolls.

"The labor market recovery remains robust, with June closing out a strong second quarter of jobs growth,” said ADP chief economist Nela Richardson. “While payrolls are still nearly 7 million short of pre-COVID19 levels, job gains have totaled about 3 million since the beginning of 2021. Service providers, the hardest hit sector, continue to do the heavy lifting, with leisure and hospitality posting the strongest gain as businesses begin to reopen to full capacity across the country."

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