Key Takeaways:
- Silver rallied to the top of its weekly range after weak June payrolls data
- US economy added 57,000 jobs versus 100,000 consensus estimate
- Softer labor data raises expectations for Federal Reserve rate cuts
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Silver rallies to weekly high after June jobs data misses by 43,000
Silver rose to the top of its weekly range Friday after US payrolls growth missed forecasts by 43,000, sending the dollar lower and boosting demand for the precious metal.
The US economy added 57,000 jobs in June, well below the 100,000 consensus estimate, the Bureau of Labor Statistics reported. The unemployment rate fell to 4.2% from 4.3% in May, though the decline reflected a drop in labor force participation rather than stronger hiring.
May payrolls were revised down to 129,000 from the initially reported 172,000, marking two consecutive months of weakening job creation. Average hourly earnings rose 13 cents to $37.64, a 0.3% monthly gain that matched expectations.
The weaker-than-expected data reduces the likelihood of further Federal Reserve rate hikes and increases the probability of rate cuts later this year, a scenario that typically supports non-yielding assets such as silver and gold. Lower real interest rates and a softer dollar improve the investment case for precious metals, which have traded in a narrow range over the past week.
Silver's move to the upper end of its weekly range puts the metal within striking distance of recent resistance levels. Traders will watch next week's consumer price index release for further clues on the Fed's policy path, as inflation data will help determine whether the labor market softening translates into monetary easing.
This article is for informational purposes only and does not constitute investment advice.
