Gold firm as Fed rate cut bets remain strong despite mixed US labor data
Gold (XAU/USD) registers modest gains on Thursday, even though the latest US jobs data indicates that the labor market remains resilient, though signs of cooling are emerging. High expectations that the Federal Reserve (Fed) will cut rates keep Bullion prices underpinned, with XAU/USD trading at $4,212, up 0.25% at the time of writing.
Mixed US labor data keeps rate-cut bets elevated, helping Bullion extend gains despite signs of a steady jobs market
Market mood is mixed after the latest release of US economic data showed the labor market is weakening, but not as fast as economists expected. The Challenger Jobs Cut report, along with the number of Americans filing for unemployment benefits, reported mixed readings. The former hit its highest level of firing for November since 2022, while jobless claims reached its lowest level since September 2022, when the print was 189K.
Expectations for a rate cut remain high, with odds standing at 85% for a quarter of a percentage point rate cut by the Fed at next week’s meeting.
Odds grew following a dismal ADP National Employment Change report on Wednesday, which showed that private companies slashed 32K jobs last month.
A Reuters poll revealed that economists are expecting a rate cut at the December meeting, which is bullish for Gold prices, which tend to benefit from low-interest-rate environments.
Ahead, traders are eyeing the release of the Fed’s preferred inflation gauge, the Core Personal Consumption Expenditures (PCE) Price Index for September.
Source: FXstreet.com
