Gold Edges Up as Traders Weigh US Jobs Data, Fed Rate Path
ManuelSummary:
Central-bank buying and inflows to exchange-traded funds on the back of the so-called debasement trade also underpinned the precious metal’s scorching 65% rally last year.
Gold edged higher as traders assessed the US Federal Reserve’s interest rate outlook after jobs data delivered mixed signals on the health of the world’s largest economy.
Bullion was trading near near $4,510 an ounce Friday in New York following a monthly payrolls report showed employers added fewer jobs in December than expected, capping a yearlong slowdown in the labor market. The unemployment rate edged down to 4.4%. Fed Reserve Bank of Richmond President Tom Barkin said the numbers reflected modest jobs growth and a continued low-hiring environment.
Gold posted a gain this week, with traders continuing to price in two rate cuts overall in 2026. A lower interest-rate environment is a tailwind for precious metals, and last year’s cuts were a factor in bullion’s best annual performance since 1979. Central-bank buying and inflows to exchange-traded funds on the back of the so-called debasement trade also underpinned the precious metal’s scorching 65% rally last year.
In other precious metals, silver gained as much as 4.6% Friday, ending a two-day rout. The commodity rallied almost 150% last year — far outperforming gold — following a historic short squeeze that gripped the market in October amid US tariff fears and rampant demand from India. Silver has continued to benefit from tightness in the dominant spot market in London as tariff fears prevent metal from flowing from packed warehouses in the US.
“We anticipate further price upside across the precious metals complex, as persistent economic and geopolitical uncertainties continue to support portfolio diversification,” analysts from consulting firm Metals Focus said in a report Friday. “For the white metals, US tariff uncertainty and favorable underlying fundamentals are likely to provide an additional boost to prices.”
Meanwhile, the safe haven appeal of precious metals has been reinforced by geopolitical tensions around China-Japan trade relations and the US capture of Venezuela’s leader. The ousting of Nicolás Maduro is supportive of higher gold prices “given the short- and long-term uncertainty it introduces for commodity markets and for Washington’s relations with Beijing and Moscow,” analysts from BMI, a unit of Fitch Solutions Inc., said in a note.
Elsewhere, the imminent selection of a new Fed chair also is being closely watched by traders. Treasury Secretary Scott Bessent said he anticipates President Donald Trump will decide this month on a successor to Jerome Powell, whose term as central bank head will end in May. Four candidates are in the frame, Bessent said.
In the near term, a broad rebalancing of commodity indexes might also put some pressure on prices. The gold and silver rallies are pushing passive tracking funds to sell some contracts over the next few days to match new weightings.
Gold edged up 0.7% to $4,507.61 an ounce as of 4:34 p.m. in New York. Silver was up 3.6% to $79.74. Platinum was little-changed, while palladium rose.
Source: Bloomberg
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