Urgent: Gold changes course for the second time now
Investing.com - Updated at 17:10 Saudi Arabia time
Gold prices have now turned higher after initially declining upon the release of US employment data. Investors seem to be buying the dip in gold prices during these moments of today's trading after the initial drop.
Gold futures are up 0.26% to $1,836 per ounce, while spot gold contracts have risen 0.14% to $1,823 per ounce.
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Important US employment data has been released, which will help determine the Federal Reserve's decision at the November meeting. The market eagerly awaited these figures, especially after the ADP initial employment data showed a significant slowdown in job additions.
However, private sector employment data, on the contrary, revealed an addition of 336,000 jobs in September, surpassing expert expectations of just 170,000. August's data was also revised upward, recording 227,000 new jobs instead of the previously reported 187,000.
Gold prices, both spot and futures, plummeted after the data revealed strong labor market strength, prompting Jerome Powell, the Chairman of the Federal Reserve, to consider another interest rate hike to curb inflation.
Gold prices currently stand at $1,823.9 per ounce as of 15:45 Riyadh time, down 0.42%. Spot gold also dropped by 0.50% to $1,812.37 per ounce.
On the other hand, the US dollar index rose by 0.46% to 106.547 against a basket of foreign currencies. US Treasury bond yields also began to rise.
Gold this morning before the employment data release
Gold prices have seen noticeable fluctuations between futures and spot contracts during today's trading, particularly as the US dollar resumed its climb after a temporary pause in its strong gains earlier this week.
Markets are anticipating the release of nonfarm payrolls data in the United States today.
Gold and the US dollar now
Gold futures rose by 0.06% to $1,833 per ounce, while spot gold contracts fell by 0.05% to $1,819 per ounce. However, they are on track to record losses for the second consecutive week.
On the other hand, the US dollar index is up by 0.17% to 106.245 points.
Gold at yesterday's close
Gold prices turned lower at the close of trading yesterday, extending their losses for the ninth consecutive session despite a drop in the US dollar and US bond yields.
Concerns about continued monetary tightening were renewed after data showed a lower-than-expected increase in jobless claims in the United States last week. However, jobless claims remain near their lowest levels, reflecting a strong job market.
At the close, gold futures for December delivery fell by 0.15% or $3 to $1,831.8 per ounce, marking the lowest level at the end of a session since November 9, 2022.
Anticipation for Important Data
Yields on US ten-year Treasury bonds and the US dollar have retreated from their peaks, but both are set to record their twelfth consecutive week of gains.
Eliya Spivak, Head of Global Macroeconomic Economics at TestaLive, said, "I see the market not having full conviction to continue in this direction until the US jobs data is released."
Markets are awaiting the release of nonfarm payrolls data in the United States at 15:30 Saudi Arabia time, following a series of employment indicators released earlier this week. The data may provide clues as to whether interest rates will be raised again.
The SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, reported its lowest holdings since August 2019 on Thursday.
Other Metals
Spot silver jumped 0.5% to $21.01 per ounce, platinum rose 0.3% to $857.23, and palladium increased 0.7% to $1,149.51 after hitting five-year lows in the previous session. All of them are heading for weekly losses.
The CEO of the world's largest platinum mining company, Anglo American Platinum, told Reuters that platinum group metals' prices may remain low.