Gold, silver futures decline as strong US jobs data wane Fed rate cut hopes

New Delhi, Nov 21 (PTI) Gold and silver prices on Friday declined in the futures trade due to a firm dollar and easing expectations of interest rate cut by the US Federal Reserve after robust employment data.

On the Multi Commodity Exchange (MCX), gold futures for December delivery fell Rs 355, or 0.29 per cent, to Rs 1,22,372 per 10 grams in a business turnover of 10,453 lots.

Silver futures also traded lower, with the December contract plunging Rs 2,111, or 1.37 per cent, to Rs 1,52,040 per kilogram in 12,907 lots on the MCX.

"Gold and silver show very high price volatile and slipped as expectations for a December Fed rate cut faded after the delayed US jobs report," Rahul Kalantri, Vice-President of Commodities, Mehta Equities, said.

Meanwhile, the US September non-farm payrolls rose by 1,19,000, more than double the forecast, signalling a labour market that is cooling gradually but still resilient.

The unemployment rate, however, edged up to 4.4 per cent, the highest since late 2021, while wage growth at 3.8 per cent slightly beat estimates, adding complexity to the policy outlook, Kalantri added.

Manav Modi, Analyst, Precious Metal, Research, Motilal Oswal Financial Services, said the dollar index, which stayed firm at 100.10, against a basket of major currencies, continued to put downward pressure on bullion prices.

In the international markets, Comex gold for December delivery went lower by 0.14 per cent to USD 4,054.46 per ounce, while silver fell nearly 2 per cent to USD 49.34 an ounce.

Modi said the prolonged US government shutdown has disrupted key economic releases, with the Bureau of Labor Statistics merging October and November jobs data into a combined report, while GDP data has also been pushed back as well, increasing market uncertainty.

Meanwhile, geopolitical developments related to a potential Russia-Ukraine peace discussions, have also impacted safe-haven asset, he added.

Minutes from the Federal Open Market Committee (FOMC) October meeting revealed that Fed officials proceeded with a interest rate cut despite voicing concerns that such a move could elevate inflation risks and potentially weaken consumer confidence. PTI HG TRB