(Kitco News) - The gold market is trying to find some stability but faces renewed headwinds as the U.S. private-sector labor market remains fairly resilient, according to the latest employment data from private payrolls processor ADP.
ADP said Wednesday that 90,000 jobs were created in September, up from 36,000 in August. The data significantly beat expectations, as consensus estimates had forecast a gain of 73,000 jobs.
The report noted that hiring accelerated for the first time since May, led by education and health care, as well as leisure and hospitality.
“It’s a strong report. After a three-month slowdown, job creation rebounded and pay growth remained solid,” said Dr. Nela Richardson, Chief Economist at ADP.
Gold prices saw some selling pressure in their initial reaction to the better-than-expected labor market data. Spot gold last traded at $4,184.40 an ounce, roughly flat on the day.
Analysts expect this week’s labor market data to have an outsized impact on gold prices. Some analysts have said that the precious metal needs to see significant weakness in the labor market to ignite a new rally back above $4,300 an ounce.
According to economists, the healthy labor market data gives the Federal Reserve room to continue fighting inflation pressures. The U.S. central bank has said that bringing inflation back down to its 2% target remains its main priority as the U.S. labor market remains relatively stable.
