(Bloomberg) -- Gold held above $1,800 an ounce on Wednesday after data showed the U.S. unexpectedly shedding jobs last month.
A report by the ADP Research Institute showed businesses’ payrolls fell by 301,000 last month, after a revised 776,000 gain in December. It demonstrates the impact the omicron variant has had on the American economy, a factor that will be weighed by the Federal Reserve as they decide on monetary policy.
None of the six Fed officials speaking so far this week have backed the idea of a half-point rate increase in March, and the most aggressive, James Bullard, president of the St. Louis Fed, said five hikes -- one more than every quarter -- is “not too bad a bet.”
That’s prompted a three-day losing streak in the dollar, supporting bullion prices. Gold has still lost 1.3% this year after the Fed’s more hawkish turn prompted investors to cut back their positions from two-month highs.
“The Comex seems to be in charge of price direction at the moment,” said Adrian Ash, director of research at brokerage BullionVault. “You could see a lot of money going into futures before the Fed, then it all seems to have come straight out again.”
Traders will scrutinize Friday’s nonfarm payrolls report closely for an indication of how fast wages are rising in the U.S. That in turn affects inflation, which is persisting for longer than policymakers predicted.
Spot gold rose 0.2% to $1,804.89 an ounce by 1:38 p.m. London time. Silver, platinum and palladium all gained. The Bloomberg Dollar Spot index fell 0.3%.
Markets in China and some other Asian countries will be closed for much of the week for the Lunar New Year holidays.
©2022 Bloomberg L.P.
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