Gold holds steady as markets await key US jobs data
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Gold prices remained near a four-week high on Thursday, reflecting cautious optimism as markets turned their attention to Friday’s US non-farm payrolls report for guidance on the Federal Reserve’s monetary policy path for 2025.
Gold market overview
Spot gold performance
Spot gold rose 0.1% to $2,664.30 per ounce as of 0732 GMT, while US gold futures gained 0.4%, trading at $2,681.80.
Price drivers
US economic data impact
Gold hit a near four-week high earlier this week following weaker-than-expected US private employment data, which fueled speculation that the Fed may slow the pace of rate cuts in 2025.
The upcoming non-farm payrolls report is now the market’s focus, with traders seeking clarity on labor market resilience and its implications for interest rates.
Inflationary concerns
Policymakers at the Fed's December meeting noted that higher-than-expected inflation and potential changes in trade and immigration policies under President-elect Donald Trump could delay the disinflation process.
Gold, often seen as an inflation hedge, may benefit if inflationary pressures persist. However, rising interest rates diminish the appeal of the non-yielding asset.
ETF inflows and long-term outlook
For the first time in four years, physically-backed gold exchange-traded funds (ETFs) registered inflows, according to the World Gold Council.
HSBC analysts noted that while gold’s upward momentum may persist in early 2025, physical and financial market factors could moderate gains by the year’s end.
Broader precious metals market
Silver: Spot silver rose 0.2% to $30.17 per ounce, reflecting modest gains.
Platinum: Prices dipped 0.3% to $952.54 per ounce, showing relative weakness in industrial demand. Palladium: Prices fell 0.8% to $921.37 per ounce, continuing to face headwinds amid shifting demand dynamics.
Key insights from analysts
Ajay Kedia, Director at Kedia Commodities, commented that gold prices are trading in a tight range, awaiting a significant trigger to breach resistance levels.
HSBC projected that while gold may see near-term gains, broader market dynamics could temper its rally later in the year.
Outlook
Gold’s performance will hinge on the outcome of Friday’s US jobs report, as well as broader inflationary and monetary policy trends under the incoming Trump administration. Investors should also monitor ETF flows and shifts in demand for physical gold to gauge long-term price direction.
Conclusion
Gold remains a focal point for investors navigating inflation concerns and uncertain Federal Reserve policies. While near-term momentum suggests potential gains, broader economic conditions and market factors may cap its upside later in 2025. The precious metals market, led by gold, continues to be shaped by macroeconomic developments and shifting investor sentiment.
Gold market overview
Spot gold performance
Spot gold rose 0.1% to $2,664.30 per ounce as of 0732 GMT, while US gold futures gained 0.4%, trading at $2,681.80.
Price drivers
US economic data impact
Gold hit a near four-week high earlier this week following weaker-than-expected US private employment data, which fueled speculation that the Fed may slow the pace of rate cuts in 2025.
The upcoming non-farm payrolls report is now the market’s focus, with traders seeking clarity on labor market resilience and its implications for interest rates.
Inflationary concerns
Policymakers at the Fed's December meeting noted that higher-than-expected inflation and potential changes in trade and immigration policies under President-elect Donald Trump could delay the disinflation process.
Gold, often seen as an inflation hedge, may benefit if inflationary pressures persist. However, rising interest rates diminish the appeal of the non-yielding asset.
ETF inflows and long-term outlook
For the first time in four years, physically-backed gold exchange-traded funds (ETFs) registered inflows, according to the World Gold Council.
HSBC analysts noted that while gold’s upward momentum may persist in early 2025, physical and financial market factors could moderate gains by the year’s end.
Broader precious metals market
Silver: Spot silver rose 0.2% to $30.17 per ounce, reflecting modest gains.
Platinum: Prices dipped 0.3% to $952.54 per ounce, showing relative weakness in industrial demand. Palladium: Prices fell 0.8% to $921.37 per ounce, continuing to face headwinds amid shifting demand dynamics.
Key insights from analysts
Ajay Kedia, Director at Kedia Commodities, commented that gold prices are trading in a tight range, awaiting a significant trigger to breach resistance levels.
HSBC projected that while gold may see near-term gains, broader market dynamics could temper its rally later in the year.
Outlook
Gold’s performance will hinge on the outcome of Friday’s US jobs report, as well as broader inflationary and monetary policy trends under the incoming Trump administration. Investors should also monitor ETF flows and shifts in demand for physical gold to gauge long-term price direction.
Conclusion
Gold remains a focal point for investors navigating inflation concerns and uncertain Federal Reserve policies. While near-term momentum suggests potential gains, broader economic conditions and market factors may cap its upside later in 2025. The precious metals market, led by gold, continues to be shaped by macroeconomic developments and shifting investor sentiment.