(Kitco News) – Gold prices are holding their breakout gains above $2,000. Still, they are not seeing a lot of new momentum following weaker-than-expected growth in the U.S. private-sector labor market, according to private-payrolls processor ADP.
Wednesday, ADP said that 145,000 jobs were created last month. The data significantly missed expectations as Economists were looking for job gains of around 208,000.
The gold market is holding steady, with June gold futures last trading at $2,045.50 an ounce..
According to some analysts, the latest employment data will add to growing speculation that the Federal Reserve is done raising interest rates, despite some hawkish rhetoric from the central bank.
The CME Fed WatchTool shows that markets see a 50/50 chance that the Federal Reserve will leave interest rates unchanged at 5.00% in May.
Although the U.S. economy continues to create jobs, there were declines in two major sectors. The report said 30,000 manufacturing jobs were lost in March in the broad goods-producing sector. The natural resource/mining sector created 47,000 jobs and 53,000 jobs were created in the construction sector.
Meanwhile, in the service sector, the report noted that professional/business services saw job losses of 46,000. The Financial industry lost 51,000 jobs last month. Trade/transportation and utilities created 56,000 jobs last month; the IT sector lost 7,000 jobs; 17,000 jobs were created in the education and health services sectors. The hospitality sector continues to see strong growth, with 98,000 jobs created.
Along with weaker-than-expected job growth, the report noted that wages are starting to decline, which for some, is an indication that inflation is cooling. The report said that year-over-year wage gains fell to 6.9%, down from the three-month plateau at 7.2%.
For workers who changed jobs, wage growth was 14.2%, down from February’s increase of 14.4%.
The ADP report will be the only chance markets will have to react to monthly employment data. Markets will be closed Friday for the Easter long weekend as the U.S. government releases its nonfarm payrolls report.
