Gold Prices Decline Amid Strong U.S. Jobs Data and Dollar Strength
Gold prices experienced a decline on Friday, positioning the precious metal for weekly losses due to strong U.S. labor market data that lowered expectations for a near-term interest rate cut, compounded by a robust performance of the U.S. dollar.
Specifically, spot gold prices decreased by 0.2% to $4062.79 per ounce as of 01:57 GMT, reflecting a weekly decline of 0.3%. In contrast, U.S. gold futures for December delivery saw a slight uptick of 0.2%, reaching $4068.10 per ounce.
This downward trend is linked to a delayed report from the U.S. Department of Labor—postponed due to a federal government shutdown—indicating an increase of 119,000 non-farm jobs in September, significantly surpassing the anticipated 50,000 jobs.
These positive economic indicators led market participants to adjust their forecasts, with traders now estimating a 39% probability that the U.S. Federal Reserve will implement an interest rate cut next month, down from earlier expectations of 60% this month. It is important to note that gold, which does not yield interest, typically benefits from lower interest rate environments.
Additionally, the strengthening U.S. dollar has intensified pressure on gold prices, as the dollar is on track for its strongest weekly performance in over a month, making gold more expensive for holders of other currencies.
In the broader precious metals market, performance was mixed: silver fell by 0.4% to $50.39 per ounce, while platinum rose by 0.4% to $1517.95, and palladium increased by 0.3% to $1381.22 per ounce.
