PT Rifan Financindo Berjangka – Gold Holds Ahead of US Data, Rate Path
Gold steadied after a two-day advance as traders weighed the outlook for the Federal Reserve’s easing path ahead of key jobs figures due later this week.
Bullion was trading near $2,660 an ounce, after rising 0.5% on Wednesday as a report showed U.S. private-sector hiring and wage growth slowed in December. The Fed will need to balance that with renewed inflation fears when deciding whether to cut interest rates, with the central bank’s meeting minutes last month reiterating a more cautious approach to easing.
Lower borrowing costs are usually positive for gold, which carries no interest. Traders now turn their attention to Friday’s payrolls data for December, which is expected to show modest but still healthy job growth that economists expect to continue into 2025. A survey by 22V Research showed most investors were watching the report more closely than usual.
Bullion surged 27% last year at a record high, fueled in part by U.S. monetary easing, though the rally lost momentum after Trump’s U.S. election victory buoyed the dollar. Bulls now face the prospect of less impressive gains this year, with Goldman Sachs Group Inc. this week pushing back its target for gold to reach $3,000 an ounce by mid-2026 on expectations for fewer Fed cuts.
Spot gold fell 0.1% to $2,660.57 an ounce as of 8:14 a.m. in Singapore. The Bloomberg Dollar Spot Index was flat. Silver and palladium were steady, while platinum edged down.
Source: Bloomberg
Gold Climbs After Weaker-Than-Expected Private Payrolls Data
Gold prices hit a near four-week high on Wednesday after a weaker-than-expected private employment report for December provided reassurance for some in the market the U.S. Federal Reserve may be less cautious about easing rates this year.
Spot gold rose 0.3% to $2,657.38 per ounce, as of 02:15 p.m. ET (1915 GMT) and hit its highest since Dec. 13. U.S. gold futures settled 0.3% higher at $2,672.40.
Weaker private payrolls “is contributing to gold’s move, because ultimately, weaker employment numbers imply that the economy has been weaker than many had expected,” said Bart Melek, head of commodity strategies at TD Securities.
The ADP National Employment report showed the U.S. economy added 122,000 jobs in the private sector last month, compared with economists’ estimate of a rise of 140,000.
A separate Labor Department report showed jobless claims stood at 201,000 in the previous week, lower than estimates of 218,000.
“The bigger factor will be U.S. nonfarm payrolls on Friday, the market is expecting a change of 163 (thousand); anything significantly above that will be negative for gold,” Melek said.
Traders are on edge ahead of Friday’s key U.S. labor data, due at 08:30 a.m. ET, and Donald Trump’s Jan. 20 inauguration, with expectations of a flurry of policy moves marking the start of his second presidency.
Minutes from the Federal Reserve’s Dec. 17-18 meeting revealed officials expect inflation to ease this year but acknowledged the risk of stubborn price pressures, particularly as they assess the potential impact of Trump’s policies.
Trump’s proposed tariffs could stoke U.S. inflation, complicating the Fed’s ability to cut rates and potentially weighing on gold prices.
However, Fed governor Christopher Waller said inflation should continue to fall in 2025 and allow the central bank to further reduce interest rates, though at an uncertain pace.
Bullion is considered an inflationary hedge, but high rates reduce the non-yielding asset’s allure.
Spot silver added 0.1% to $30.03 per ounce, platinum gained 0.2% to $952.76, palladium lost 0.1% to $925.05. PT Rifan Financindo Berjangka.
Source : Reuters