Since the Mid-Day Gold & Silver Market Report,  Gold prices  continued to drop in response to the better-than-expected January U.S. unemployment report released this morning. Gold finished the day lower, experiencing its first drop in four sessions. Gold prices for the week, however, are up by 0.5 percent. One precious metals researcher is looking at Gold’s “bigger picture,” saying, “The big news remains last week’s Fed promise of cheap money forever.” Prices on Silver, Platinum, and Palladium dipped today, as well.

Despite the unexpected fall in last month’s jobless rate, some  analysts  are questioning whether the worst really has passed. Walter Zimmerman, a senior technical analyst at price forecasting firm United-ICAP, said, “It’s better than it was, but we’re skeptical that it’s sustainable given the continuing unraveling.” Zimmerman’s view is that the current sentiment of investors is exaggerated, and that it will be proved rash when the debt crisis in Europe is again at the forefront of the news. Echoing this skepticism is Capital Economics in Toronto. In a note to clients, the company said, “We’ve been here before with 200,000-plus monthly gains in payrolls in spring 2010 and spring 2011 that ultimately came to nothing. With housing still in the dumps, fiscal policy being tightened and the eurozone crisis likely to flare up again at any moment, we still think the U.S. will endure another year of weak growth in output and employment.”

European Union sources indicated today the price for  Greece’s  second emergency loan program may end up being 145 billion euros, 15 billion more than had been estimated. If required, the additional bailout funds would mostly assist with the recapitalization of the banking sector in Greece if an agreement is reached on a proposed 70 percent write-down of private-sector creditor-held Greek bonds. Negotiations with private creditors on a write-down for Greece have been ongoing, and even if an agreement is reached, it’s not clear how much central banks in the eurozone and the rest of Europe would have to write down for Greece to sustain its overall debt burden. Meanwhile, a planned Feb. 6 meeting of  finance ministers  in the eurozone to discuss Greece’s continuing financial problems has been postponed, with nothing definite said about when it will take place other than it “may be scheduled later in the week.”

At 4:13 p.m. (CST), the APMEX precious metals spot prices were:

• Gold - $1,727.30 - Down $30.50.
• Silver - $33.69 - Down $0.56.

U.S. stock futures added to early morning gains after the release of the latest unemployment figures. Analysts had estimated that 121,000 jobs were added in January, but  the report showed 243,000  new jobs, plus adjusted figures for November and December showing a combined 60,000 additional new jobs. The unemployment rate fell to 8.3%, and most are seeing this as a good sign for economic recovery in the country. Gold and Silver dipped slightly on the news, but the dip may be limited, as the dollar also fell after the report’s release.

Mark Mobius, executive chairman of Templeton Emerging Markets Group, said  he is now bullish on the eurozone  thanks to Eastern European countries such as Austria and Romania. He said that investors are beginning to realize that the EU and the euro are here to stay. “Reforms are taking place now in Europe the effects will kick in next year, and then you’re going to see a much stronger regional community,” Mobius said.

Iran’s supreme leader Ayatollah Ali Khamenei  warned those who are enforcing an oil embargo  against Iran. Khamenei said, “Sanctions will not have any impact on our determination to continue our nuclear course. … In response to threats of oil embargo and war, we have our own threats to impose at the right time.” The comments are expected to continue driving up oil prices, and Gold traditionally has had a positive correlation with oil. Geopolitical tension is one of the major driving factors for the Gold price, as well.

At 8 a.m. (CST), the APMEX precious metals spot prices were:

• Gold - $1,755.80 – Down $2.10.
• Silver - $34.22 – Down $0.03.

While the stock market was relatively flat in anticipation of Friday’s government monthly  employment report, gold and silver experienced solid gains on the day. Of course, rising gold and silver prices might have more to do with remarks by Federal Reserve Chairman Ben Bernanke. Testifying before Congress,Mr. Bernanke defended Fed policy  against harsh criticism that recent Fed decisions risked igniting inflation. Mr. Bernanke defended these decisions as necessary in a still struggling economy.  He further stated that our sluggish economy is vulnerable to shocks.

Chinese Premier Wen Jiabao has raised the prospect that  China might be willing to provide assistanceto the euro – bailout efforts. Reportedly, he told German Chancellor Angela Merkel that China might be willing to consider funding the European Stability Mechanism through the International Monetary Fund. Premier Wen Jiabao said that China “investigating and evaluating ways, through the IMF, to be more deeply involved using the ESM and EFSF channels in solving the European debt issue.”

At 4PM the APMEX precious metal prices were:

• Gold price -  $1,757.50 – up $9.50
• Silver price - $34.31 – up 43 cents