GOLD and SILVER PRICES sank and then rebounded Friday lunchtime in London after new US jobs data came in stronger than analysts expected, crushing hopes of more steep cuts to Dollar interest rates at the Federal Reserve's last 2 decisions of 2024.

 

Following last month's half-point start to the US central bank's new rate-cutting cycle, betting in the Fed Funds futures market last week put a 50-50 chance on another half-point cut in November.

 

But already down to 1-in-3 on Thursday, that forecast sank to 1-in-10 today after the Bureau of Labor Statistics said non-farm payrolls expanded by over a quarter of a million in September, almost 60% ahead of analyst expectations.

 

Pushing the unemployment rate down to 4.1%, today's NFP data from the BLS also crushed betting on Fed interest rates being slashed in December, with year-end rates now forecast at 4.30% per annum.

 

While that's still sharply down from today's Fed Funds rate of 4.83%, it marks the highest such forecast on the CME derivatives exchange's FedWatch tool in over 3 weeks, and matches more closely what pundits called the 'hawkish' tone of Fed chair Jerome Powell's comments on Monday about cutting rates "over time" as it continues "to make our decisions meeting by meeting."

 

 

Plunging $25 per Troy ounce on today's jobs data, the price of gold hit a 3-session low at $2632, down 2.0% from last Thursday's fresh all-time.

 

Silver prices also sank, losing more than 50 cents in the first 30 minutes following the BLS' report.

 

But having fixed at London's midday benchmarking auction above $32 per Troy ounce for the 2nd time in 7 sessions, silver then reversed that drop while gold also regained most of its fall, trading at $2650.

 

Gold on Friday set a fresh record high in British Pounds, its 4th in 4 days, peaking at £2030 as Sterling headed for a near-2% weekly drop following Bank of England Governor Andrew Bailey's promise of "more active" UK interest rate cuts.

 

Euro gold prices meantime ticked a new spot-market high at €2420 after European Central Bank policymaker Mario Centeno of the Banco de Portugal said jobs growth is weakening fast in the 20-nation currency union, while inflation has slowed to the ECB's 2.0% annual target.