Gold tops $4,000 as US shutdown, weak data stoke haven demand
Gold price (XAU/USD) advances during the North American session on Friday, up 0.64% as the US government shutdown extends, while risk aversion keeps US equity markets poised for weekly losses. At the time of writing, Bullion trades at $4,002 after bouncing off daily lows of $3,974.
Bullion gains 0.64% amid risk aversion and growing bets for a December Fed rate cut
Uncertainty continues to surround the US economy, as shown by the University of Michigan preliminary Consumer Sentiment for November. The index reached its lowest level since June 2022 amid the COVID emergency, showing that households are expressing worries “about potential negative consequences for the economy” of the US government shutdown.
Consequently, Gold, which is usually sought as a hedge to uncertainty and lower interest rate environments, clung to its gains, up so far 0.13% in the week.
Meanwhile, the US job market might be slowing more sharply than expected, as the Challenger report prepared by Gray & Christmas showed on Thursday that employers fired over 150,000 people in October, the largest reduction for the month in more than 20 years.
Market participants see a 68% chance of a rate cut by the Federal Reserve (Fed) at the December meeting, according to data by the Prime Market Terminal interest rate probability tool.
Source: FXstreet
