Today is Monday, February 6. The front-month U.S. gold contract opened at $1,878.00 per ounce, compared with yesterday’s close of $1,877.70. Spot gold opened at $1,860.74 per ounce, versus yesterday’s close of $1,865.63; as of 11:57 Beijing time, the front-month U.S. gold contract was trading at $1,888.60 per ounce, up 0.58%, while spot gold was quoted at $1,875.89 per ounce, up 0.56%.

Domestic gold futures market:

On Monday, February 6, the main Shanghai Gold contract opened at RMB 419.34 per gram, unchanged from yesterday’s close of RMB 419.34 per gram; the Gold TD contract opened at RMB 418.50 per gram, compared with yesterday’s close of RMB 419.01 per gram.

A report released by the U.S. Department of Labor on Friday showed that nonfarm payrolls increased by 517,000 in January, far exceeding market expectations of 189,000 and the 223,000 gain in December. The unemployment rate fell to 3.4%, the lowest level since May 1969 and a more than 50-year low, below the market consensus of 3.6% and the December reading of 3.5%. Average hourly earnings rose 4.4% year over year, slightly above the 4.3% forecast but down from December’s 4.6%. The U.S. dollar index surged, while precious metals plunged.

Employment data is currently one of the Federal Reserve’s key focus indicators, and a shockingly weak nonfarm payrolls report could undermine the Fed’s efforts to combat inflation. Following the release of the nonfarm payrolls figures, Fed swap contracts pared bets on a rate cut in 2023, with the market now pricing in a peak policy rate of 5% by June. In response, the U.S. dollar surged by more than 100 pips, closing up 1.18% at 102.99—the highest level in three weeks.

U.S. Treasury yields surged straight after the nonfarm payrolls report, climbing more than 10 basis points during the session from 3.39% to 3.51%, nearly erasing the prior three-day decline and marking a cumulative rise of about 2 basis points for the week. On a intraday basis, yields jumped over 20 basis points, hitting their highest level since January 12; at the close of U.S. trading, they were trading around 4.29%, with a weekly gain of more than 10 basis points. Both the 10-year Treasury yield and the broader yield curve have now posted two consecutive weeks of increases after three straight weeks of declines.

Friendly reminder: International gold has stabilized above $1,800; today’s focus is on the weekly initial jobless claims. Markets can change in an instant, so invest with caution; trading strategies are for reference only.