Gold prices held above $4,200 after the ADP data release
Gold prices rose on Friday as investors awaited key inflation data for clues about the Federal Reserve's (the US central bank's) path ahead of next week's meeting.
Spot gold rose 0.41% to $4,224.74 per ounce.US gold futures for December delivery climbed 0.33% to $4,257 per ounce.
Yields on the benchmark 10-year U.S. Treasury note hovered near their highest level in more than two weeks, while the dollar weakened and remained near a five-week low against a basket of currencies.
“The market is waiting for new catalysts, which could come in the form of what the Federal Reserve does,” said Kunal Shah, head of research at Nirmal Bang Commodities.
Gold prices above $4200
What’s happening:-
Gold prices settled higher on Thursday amid weakness in the US dollar.
What happened:-
Investors remained cautious after the US reported mixed labour market data.
Markets await the release of the US inflation rate to get more insights into the Federal Reserve’s monetary policy outlook.
Why it matters:-
Data released on Thursday showed that new US jobless claims declined to 191,000 in the latest week, hitting the lowest level in more than three years. The figure also came in better than market estimates of 220,000 new jobless claims.
Meanwhile, ADP data released on Wednesday showed US private payrolls declining by 32,000 in November. This marked the steepest decline in over 2.5 years. Consulting firm Challenger announced 71,321 layoffs in the month, citing restructuring, AI adoption and the impact of tariffs.
International gold prices
Markets continue to expect the Federal Reserve to cut its key interest rates by 25 basis points at its upcoming meeting to support softness in the labour market. Lower rates generally provide a boost to non-yielding assets like gold.
Weakness in the US dollar lent further support to gold, as a softer greenback makes metals more affordable for foreign buyers. The US dollar index, which measures the greenback’s performance versus a basket of major peers, fell to a one-month low on Thursday.
US gold for February gained 0.2% to settle at $4,243.00 per ounce on Thursday.
In other commodities, silver declined to $57.491 per ounce, after hitting a record high of $58.98 in the previous session. The white metal has almost doubled in value this year, driven by supply deficit and its inclusion in the US list of critical minerals. Platinum settled at $1,660.6, while palladium closed at $1,484.00 on Thursday.
Gold prices
What to watch:-
Data on Personal Consumption Expenditures, the Fed’s preferred inflation gauge, will be released today (1900 UAE Time). PCE prices in the US, which surged 2.7% year-over-year in August, the highest in six months, are expected to jump by 2.8% in September.
Investors will also keep an eye on the movement in the US dollar and any outcome of the talks between the US and Russia.