Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold slipped 0.2% but still finished the week with a 0.7% gain after a stronger-than-expected U.S. non-farms payrolls report pushed traders into equities. Unemployment fell to 7.5%, the lowest since December 2008, as the U.S. economy added 165,000 jobs in April, and totals for February and March were revised higher by a combined 90,000. Along with unprecedented easing from the ECB and the Fed, the upbeat jobs data sparked a risk-rally in equities, driving the S&P 500 to a record-high above 1,600 and the Dow briefly over 15,000 for the first time. The other precious metals were mixed. Silver added 0.8% for the day and finished the week with a 1% gain. Platinum added 0.1% while palladium finished flat. Both PMGs gained 1.7% for the week.

At the Comex close: June gold slipped $3.40 to $1,464.20; July silver added 18 cents, to $24.01; July platinum picked up $1 to $1,501.20; and June palladium finished flat at $693.30 an ounce.

While certainly welcome, today's payrolls report is by no means a game-changer for the Fed. April's gains were far below the monthly 206,000 jobs averaged during the first quarter, which means the recovery is still cooling. The economy will need to create 165,000 jobs every single month for the next two years in order to bring unemployment down to 6.5%, the Fed's target, according to the Atlanta Fed jobs calculator. There are still more than 12 million people unemployed in the U.S., and the total number of workers remains 2.6 million fewer than in January 2008, making this the slowest recovery since World War II.

In addition, the U-6 unemployment rate, which includes part-timers unable to find full-time work, actually rose to 13.9% in April, while the total number of hours worked and the total amount of money earned by U.S. workers both fell from March. So, again, the progress is very good news. But the Fed is keenly aware of how anemic the labor market remains, and that means more quantitative easing and near-zero interest rates for the foreseeable future�both of which are bullish for gold.