Gold Prices React to Shifting Economic Factors

Gold prices fell sharply after the Bureau of Labor Statistics revealed that 339,000 new nonfarm payroll jobs were added last month, resulting in a bullish updraft in Treasury yields and the dollar. The strength of the jobs report coupled with the fact that a potential debt ceiling crisis had been averted made a recession less probable and added to the selling pressure created by market participants. Although today’s better-than-expected jobs report lowered the probability that the Federal Reserve will begin a rate hike pause this month, the probability of a pause is still remarkably high.