GOLD PRICES fell into Friday's London benchmark auction this afternoon, cutting the precious metal's weekly gain to 1.2% for Dollar investors as mixed new on the US jobs market was followed by less-awful data from the manufacturing sector.

 

While US factory activity shrank for the 10th month running in August, it contracted at the slowest pace since February, today's ISM PMI survey said, proving better than analysts had forecast.

 

Against that, non-farm payrolls across the whole economy grew faster than expected on Friday's estimate from the Bureau of Labor Statistics.

 

But average wage growth slowed beneath 4.3% per year, the weakest in over 2 years and barely matching the latest reported pace of inflation on the Federal Reserve's preferred core PCE index, while the unemployment rate rose 3 tenths of a point to 3.8%, the worst since January 2022 – back before the Fed began raising interest rates to counter the worst inflation in 4 decades.

 

Dollar gold prices touched $1952 per Troy ounce on that 'NFP' news, the highest spot-market quote since the start of last month, before dropping 0.9% as London's physical bullion trading shut for the weekend.

 

 

Both the Dollar and longer-term US borrowing costs went in the other direction, dropping on the jobs figures before rebounding to 3-session highs on the FX and bond markets.

 

"If the economy can continue to expand and the labor market can cool at a slow pace," one pundit told Insider after the NFP report, "then the Fed can afford to leave rates where they are and patiently wait for higher rates to do their work" in reducing inflation, thereby inviting US stock markets to rally.

 

But like gold prices, US stock markets initially rose on the jobs data before giving back Friday's gains on the less-weak-than-expected PMI figures.

 

Silver also rose with gold prices before dropping back, spiking 20 cents below Wednesday's 6-week high of $25.00 per Troy ounce and then falling over 60 cents within an hour of the ISM PMI report.

 

Factory activity in China also came in less-bad than analysts expected for August today. But the 20-nation Eurozone proved worse even than last month's preliminary reading, with manufacturing powerhouse Germany giving its 2nd worst reading since the depths of the first-wave Covid lockdown catastrophe in spring 2020.

 

Losing 1.4% across August in Dollar terms, gold bullion held dead-flat in Sterling and rose 0.3% in Euros to its highest monthly finish in three.

 

Today's Dollar rebound after the ISM data saw both the UK gold price in Pounds per ounce and the Euro gold price rise to their highest since mid-June, reaching £1538 and coming within €3 of €1800 respectively.