gold extended its stunning rally to the eighth day on Friday as the US nonfarm payroll report of February was weaker than expected. The metal rose to a fresh record high as it hit $2195 before closing with a gain of 0.89% at $2179. It posted a whooping weekly gain of 4.60%.
The US employers added 275K jobs in February, which was above the forecast of 200K jobs; however, the unemployment rate rose to a two-year high of 3.90% from 3.70% in January and was way above the forecast of 3.70%. Moreover, the previous two-month figures were revised lower by 167K jobs and government hirings accounted for 52K jobs, which took the sheen off the headline number. Average hourly earnings m-o-m came in at 0.10% versus the forecast of 0.20%, while y-o-y earnings at 4.30% met the forecast though it was lower than the prior data of 4.40%. Labour force participation at 62.50% was lower than the estimate of 62.60%.
The US bonds rallied on a soft job report, though the ten-year yields recovered nearly 1% from the day's low to close with a loss of 0.26% at 4.08%. The ten-year yields were down nearly 2.50% on the week, whereas the two-year yields fell 0.57% to close at 4.48% Friday and were down nearly 1.50% on the week. The US Dollar Index closed lower for the sixth straight day Friday and was down around 1% on the week.
The US treasury will sell $117 billion in treasury coupons from Monday to Wednesday, so investors sold into Friday's bond rallies, which kept a floor under the falling yields, which in turn capped the gains in gold,