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(Kitco News) -
The U.S. labor market is continuing to show signs of improvement as applications for first-time unemployment benefits beat market expectations for the second straight week, sparking a selloff in gold.
Thursday, the U.S. Labor Department said that weekly jobless claims rose by 4,000 to 229,000 for the week ending May 20, up slightly from the previous week's level of 225,000 claims, which was revised down by 17,000 from 242,000.
According to consensus forecasts, economists were predicting initial claims to rise to 245,000.
Taken together, the last two reports have shown marked improvement since initial claims for the week ending May 6 came in at the highest level since October 30, 2021.
Gold prices fell sharply in the wake of the better-than-expected employment data, with spot gold dropping from $1960.48 just before the release to session lows just over $1940 per ounce at the time of writing.
The four-week moving average for new claims – often viewed as a more reliable measure of the labor market since it flattens week-to-week volatility – was unchanged from the previous week’s revised average of 231,750.
Continuing jobless claims, which represent the number of people already receiving benefits, fell to 1.794 million during the week ending May 13, decreasing by 5,000 from the previous week's unrevised level of 1.799 million.
