Gold Closes Little Changed After Moving Sharply Higher In Early Trading

(RTTNews) - Gold prices moved sharply higher in early trading on Friday but gave back ground over the course of the session to close little changed.

After surging to a high of $1,980.20 an ounce, gold for December delivery ended the day up just $1.20 or 0.1 percent at $1,967.10 an ounce. Gold still jumped by 1.4 percent for the week.

The price of gold initially benefitted from U.S. dollar weakness following the release of the Labor Department's closely watched monthly jobs report.

While the closely watched report showed modestly stronger than expected job growth in the month of August, the report also showed an unexpected increase in the unemployment rate.

The Labor Department said employment climbed by 187,000 jobs in August compared to economist estimates for the addition of 170,000 jobs.

Meanwhile, the report said the unemployment rate climbed to 3.8 percent in August from 3.5 percent in July. Economists had expected the unemployment rate to remain unchanged.

With the unexpected increase, the unemployment rate reached its highest level since hitting a matching rate in March 2022.

The advance by the unemployment rate came as the size of the labor force surged by 736,000 persons, while the household survey measure of employment rose by 222,000 persons.

However, the U.S. dollar recovered and moved higher over the course of the day, with the U.S. dollar index climbing 0.6 percent to 104.25.

The advance by the dollar and subsequent pullback by gold came after the Institute for Supply Management released a report showing a slowdown in the pace of contraction in U.S. manufacturing activity.

The ISM said its manufacturing PMI rose to 47.6 in August from 46.4 in July, although a reading below 50 still indicates a contraction. Economists had expected the index to inch up to 47.0.