Better than expected NFP data pull gold prices down

Gold drops below $2,000 an ounce again

By Nadia Elbilassy | @Nadia Elbilassy | 5 July 2023

Midday Market update
  • Sterling stabilizes amid official holidays

  • Canadian dollar bulls wait for Bank of Canada meeting policy

Gold dips below $2,000 again

In line with Fridays US labor market data, which indicated continuous growth in the sector, with unemployment rates falling and the economy continuing to create more jobs. The price of the safe haven declined below the $2,000 mark. To open the week with a drop as the USD rises again.

Gold prices were trading near $1,995 per ounce, down about 0.60%.

Last week's data showed an addition of 236,000 jobs in the US labor market, vs 228,000 jobs expected and lower than the previous reading of 311,000 jobs, while the unemployment rate fell to 3.5% compared to the previous reading of 3.6%.

Markets now tune in CPI figures due Wednesday.

Sterling stabilizes amid official holidays.

As markets were muted last week in celebration of Good Friday, as well as the Easter break, European markets remained closed with low levels of volatility.

The pound saw a slight decline against the US dollar at the beginning of the week, trading near $1.2409. Expectations that the Bank of England will continue to tighten monetary policy. BOE member Hua Bell stated that interest rate decisions now will rely on data.

GBP traders now sit on, for the US economic indicators due this week, as well as the release of UK GDP data on Thursday.

Bank of Canada next in line

After the declines seen throughout last week, the Canadian dollar opened this week's trading higher, amid expectations that the bank of Canada will keep interest rates unchanged at 4.50%.

The USD/CAD was last seen trading near 1.3493.

Earlier, Bank of Canada Deputy Governor Tony Gravel said the bank is closely monitoring the pressures on the global banking system before making its next interest rate decision and issuing its monetary policy report, indicating that the bank is ready to act if there is severe pressure on the market and provide liquidity support to the banking system.