By Ira Iosebashvili
Gold prices fell Friday, after U.S. jobs data showed wages rising at their strongest pace in eight years.
Gold for February delivery closed down 0.7% at $1,173.40 a troy ounce on the Comex division of the New York Mercantile Exchange.
Although job creation slowed in December and unemployment ticked higher, wage growth was the strongest since 2009, bolstering the case for the Federal Reserve to raise rates at a faster clip this year. Expectations of higher rates tend to weigh on gold, which struggles to compete with yield-bearing investments when borrowing costs rise.
The data "supports the Fed's decision to increase rates," said GeorgeGero, managing director at RBC Capital Management.
Looking forward, however, the data also suggests that inflation may be on the rise, Mr. Gero said. That may support gold, as some investors buy the precious metal when consumer prices rise, believing it will hold its value better than other assets.
Nonfarm payrolls rose by a seasonally adjusted 156,000 in December from the prior month, the Labor Department said Friday. The unemployment rate ticked up to 4.7% last month from 4.6% in November.
Economists surveyed by The Wall Street Journal had expected 183,000 new jobs and a jobless rate of 4.7%.
Silver for March delivery was down 0.7% at 16.51 a troy ounce. April platinum fell 0.6% to $970.60 a troy ounce. March palladium rose 2.7% to $758.35 a troy ounce.
Write to Ira Iosebashvili at email@example.com
(END) Dow Jones Newswires
January 06, 2017 16:11 ET (21:11 GMT)
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