Gold prices rose after traders increased bets on a December interest rate cut by the Federal Reserve following the release of unexpectedly weak US employment data, UNN reports with reference to Bloomberg.
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On Friday, gold prices exceeded $4,000 per ounce, paring losses from the previous session and ending trading virtually unchanged. The yield on 10-year US Treasury bonds fell the most in a month on Thursday after employment firm Challenger, Gray & Christmas Inc. released data showing the largest job cuts in October in more than 20 years. Fears of a weakening labor market could strengthen the case for further rate cuts – a scenario that typically favors non-yielding precious metals, the publication writes.
However, US officials have expressed conflicting views on the outlook for monetary policy. Chicago Federal Reserve Bank President Austan Goolsbee said on Thursday that the lack of official inflation data due to the US government shutdown makes him "even more concerned" about further reductions in borrowing costs.
Gold prices were virtually unchanged from last Friday's close after two consecutive weeks of declines, after prices rebounded from a record high of over $4,380 per ounce last month. Nevertheless, the metal's price has risen by more than 50% this year and is on track for its best annual performance since 1979.
US rate cuts have supported gold prices, which have also risen in recent months due to inflows into gold-backed exchange-traded funds (ETFs) and increased central bank purchases. The government shutdown – the longest in US history – has complicated the assessment of the world's largest economy, making data from private companies such as Challenger an increasingly important benchmark.
Current US shutdown has become the longest in history05.11.25, 10:32 • [views_3247]
The Federal Reserve's (Fed) Open Market Committee, which sets rates, is scheduled to meet next month for its final meeting of 2025.
Regarding other precious metals, silver is rising for the third consecutive day after the US added it to the government's list of critical minerals included in the Trump administration's Section 232 investigation, which could lead to tariffs and trade restrictions. Any tariffs on silver could negatively impact metal markets, as the US is highly dependent on imports to meet demand.
Spot gold prices rose 0.8% to $4,007.14 per ounce by 2:55 PM in Singapore. The Bloomberg Dollar Spot Index increased by 0.1%. Platinum and palladium also rose in price.
Recall
According to fintech expert and co-founder of Concord Fintech Solutions, Olena Sosedka, the trend of rising gold prices is reinforced by the unstable geopolitical situation in the world.
"Wars, trade conflicts, unpredictable decisions of world leaders – all this creates an atmosphere of constant instability, in which gold becomes a universal insurance. So, the jump in the value of gold is not just a financial event, it is a marker of investor confidence in the modern economy. And for the fintech market, this is a clear signal: technologies can make finance more convenient, but the basis of trust is always built on simple and understandable values," summarized Olena Sosedka.
She noted that the current rise in gold prices is just the tip of the iceberg, as at a global level it indicates investors' preparation for a weakening dollar. The depreciation of the American currency makes gold more accessible to buyers in international markets, which, in turn, strengthens demand and stimulates further price growth.
The main drivers of stable gold demand remain central banks, primarily China and Russia. They are actively increasing their gold reserves, effectively implementing a de-dollarization strategy and demonstrating a desire to reduce dependence on the American currency.