US employers added far fewer jobs than expected in September, while the unemployment rate rose to 4.2%, strengthening expectations that the Federal Reserve may leave interest rates unchanged in October.
Gold prices fell as a stronger dollar and elevated Treasury yields outweighed earlier support from the weaker US jobs report.
Oil prices were mixed after European countries agreed to release additional diesel stockpiles, easing concerns over fuel supplies.
US Treasury yields reversed an initial decline after the jobs data, with the 10-year yield rising back above 5.2% as investors continued to assess the outlook for Federal Reserve policy.
US job growth slows
The US economy added 29,000 jobs in September, well below the 84,000 increase expected by economists in the Dow Jones consensus.
The unemployment rate rose to 4.2% from 4.1%, while the labour force participation rate edged up to 61.8%.
The latest employment report also included significant downward revisions to previous months.
July payroll growth was revised from an initial increase of 21,000 to a decline of 10,000, while August growth was revised from 162,000 to 133,000.
The revisions reduced combined employment gains for July and August by 60,000 from previous estimates.
The unemployment rate has remained within a relatively narrow range of 4.1% to 4.3% since March, while the employment-population ratio stood at 59.2% in September.
The weak report increased market expectations that the Fed will keep rates unchanged at its October meeting. Traders were pricing roughly a 25% chance of an October rate hike, compared with about 70% earlier in the week.
Gold prices extend losses
Gold prices fell on Friday after initially gaining more than 1% following the weak employment report.
Spot gold declined 0.75% to $4,146.54 an ounce and was down about 3.19% for the week. US gold futures settled 0.59% lower at $4,177.50.
A stronger dollar and higher Treasury yields weighed on the non-yielding metal.
The dollar was heading for a weekly gain, while 10- and 30-year Treasury yields had reached their highest levels since 2002 earlier in the week.
The weaker jobs report had initially supported gold by reducing expectations for another Fed rate increase.
However, traders continued to assess whether the central bank would maintain a relatively hawkish stance.
Spot silver fell 0.8% to $60.36, platinum declined 2% to $1,692.90 and palladium lost 0.5%.
All three metals were headed for weekly declines.
WTI declines while Brent rises
Oil prices fell after European countries agreed to a proposal to release additional diesel reserves.
West Texas Intermediate declined 1.72%, to $91.28. Brent crude reversed initial loss of 1.76% and was trading 0.24% higher at $102.56.
Brent was down about 1.51% for the week, while WTI was around 1.05% lower.
The European Union’s move followed discussions around a French proposal to release 50 million barrels of diesel, while members of the International Energy Agency could release another 50 million barrels of crude.
The move came after concerns over refined fuel supplies had pushed oil prices higher.
Chinese refiners had suspended October fuel exports to preserve domestic inventories, while refinery disruptions in the Middle East and Russia had also constrained refined-product supplies.
Barclays raised its fourth-quarter Brent forecast by $20 to $115 a barrel and lifted its 2026 forecast to $100, citing strong physical-market fundamentals despite improved crude flows from the Middle East.
Treasury yields move higher
Treasury yields initially declined after the weak employment report but later reversed higher.
The 10-year Treasury yield rose almost five basis points to 5.292%, while the 30-year yield increased three basis points to 5.642%. The two-year yield, which is particularly sensitive to expectations for Fed policy, rose five basis points to 4.841%.
Earlier in the week, the 10-year yield had reached its highest level since 2002 amid concerns about inflation and expectations that interest rates could remain elevated for longer.
The yield reversal showed that investors were still assessing the broader policy outlook despite the weaker labour market data.
Market participants continued to weigh the possibility of another rate increase later in the year, with December remaining a potential window for further tightening.
Yields across major European economies also eased by around three basis points as pressure on global government bonds moderated following the sharp sell-off earlier in the week.
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