(Kitco News) - Growing slack in the U.S. labor market appears to be providing some support for gold, with prices trading near session highs after data showed that available job openings fell in line with expectations.
February job openings—a measure of labor demand—fell to 6.88 million, down from January’s revised reading of 7.24 million, according to the Labor Department’s monthly Job Openings and Labor Turnover Survey (JOLTS).
The drop matched consensus forecasts.
The gold market is attracting some renewed bullish momentum in the initial reaction to the weak labor market data. Spot gold last traded at $4,611.90 an ounce, up more than 2% on the day.
The gold market is seeing solid technical momentum after holding long-term support last week at $4,100 an ounce.
According to some analysts, a cooling U.S. labor market could force the Federal Reserve to cut interest rates through the second half of the year, even if inflation pressures remain elevated.
Looking at the components of the report, the number of hires dropped to 4.8 million, down from 5.3 million in January, and the hiring rate fell to 3.1%, compared to 3.3% at the start of the year.
“This was the lowest hires rate since April 2020, when it was also 3.1%,” the report said.
Within separations, quits came in at 3.0 million, while layoffs and discharges totaled 1.7 million, both little changed from January.
Jeffrey Roach, Chief Economist for LPL Financial, said that the latest JOLTs report highlights potential weakness in Friday’s nonfarm payrolls data.
“For most workers, the uncertainty within the job market has suppressed the desire to move from one job to another. On the labor demand side, firms have pulled back on hiring rates,” he said.
