Gold firms above $4,200 after weak ADP data, focus turns to ISM Services PMI
Gold (XAU/USD) firms as traders react to the latest ADP Employment Change report. At the time of writing, XAU/USD is trading around $4,230, with attention now shifting to the ISM Services Purchasing Managers Index due later in the day.
ADP came in noticeably weaker than expected, showing a 32K decline in November. Markets had expected a 5K increase, while October recorded a 47K gain.
The private employment data underscored weakening labour conditions in the US. The report also holds significance as October’s Nonfarm Payrolls (NFP) will be published together with the November report on December 16, leaving the Federal Reserve (Fed) with few indicators to gauge labour conditions ahead of next week’s monetary policy meeting.
According to the CME FedWatch Tool, markets already price in about an 88% chance of a 25 basis point (bps) reduction, keeping the US Dollar (USD) on the back foot and offering a broadly supportive backdrop for Gold.
Elsewhere, geopolitical tensions remain elevated after US envoys’ talks with Moscow on the Ukraine conflict failed to deliver meaningful progress.
Source : Fxstreet.com