Gold little changed in early Friday but heading for a weekly drop after strong U.S. September jobs numbers on Thursday solidified expectations that the Federal Reserve will leave interest rates unchanged in December.
The key data release was delayed by the U.S. government shutdown and came out Thursday. It showed the job market remained resilient in September, adding 119,000 jobs, more than economists had expected. That resilience likely makes it less urgent for the central bank to cut interest rates a third time in a row next month. Higher interest rates are typically bearish for gold, making it a less attractive alternate investment.
The University of Michigan’s consumer sentiment data for November was just released at 10am EDT. Consumer sentiment was little changed this month with a 2.6 index point decrease from October that is within the margin of error. After the federal shutdown ended, sentiment lifted slightly from its mid-month reading. However, consumers remain frustrated about the persistence of high prices and weakening incomes. Gold has shrugged off the data.
December gold futures fell 0.6% Thursday to settle at $4,060.00 an ounce on Comex, and the front-month contract slid 0.8% in the first four days of the week. Bullion increased 3.2% last month after surging 10% in September, the most in six months, and adding 5% in August. It’s up 54% this year. The metal rose 27% in 2024, its biggest annual gain since 2010. The December contract is currently up $11.30 (+0.28%) an ounce to $4071.30 and the DG spot price is $4073.00.
The U.S. jobs report, which would have typically come out in early October, on Thursday refuted suggestions that the labor market has been losing momentum, though the unemployment rate edged up to 4.4%, the highest level since October 2021. The Fed has said it closely watches both the labor market and inflation when setting monetary policy.
October’s interest rate reduction to 3.75% to 4.00% was the second 25-basis point reduction in a row. The central bank began raising interest rates in March 2022 to fight inflation, ultimately imposing increases of by 5.25 percentage points before beginning rate cuts last year.
Almost 74% of the investors tracked by the CME FedWatch Tool are betting that the Fed will keep interest rates unchanged in December, while the rest expect another 25 basis point cut.
Separately, the minutes of the October Fed policy meeting, which came out Wednesday, showed central bankers were divided about an October rate reduction and cast further doubt over a December cut.
“Several participants assessed that a further lowering of the target range for the federal funds rate could well be appropriate in December if the economy evolved about as they expected over the coming intermeeting period,” the minutes said. “Many participants suggested that, under their economic outlooks, it would likely be appropriate to keep the target range unchanged for the rest of the year.”
A number of Fed officials are scheduled to speak Friday and could offer further direction.
March silver futures decreased 1.1% Thursday to settle at $50.96 an ounce on Comex, though the rolling front month contract, which moved to March from December this week, is up 0.5% this week. Silver rose 3.3% in October after adding 15% in September, the biggest monthly rally in two and a half years, and climbing 11% in August. It’s up 74% this year after rising 21% in 2024. The March contract is down $1.086 (-2.13%) an ounce to $49.870 and the DG spot price is $49.72.
Spot palladium lost 0.9% Thursday to $1,394.00 an ounce and is down 1.1% in the first four days of the week. Palladium rose 14% last month after rising 14% in September and declining 7.8% in August. Palladium is up 50% this year after dropping 17% in 2024. Currently, the DG spot price is down $18.90 an ounce to $1367.50.
Spot platinum declined 2.5% Thursday to $1,522.10 an ounce but dropped 2.4% so far this week. It advanced 1% in October after gaining 15% in September and rising 5.9% in August. Platinum is up 67% in 2025 after losing 8.4% in 2024. The DG spot price is currently slightly down $0.10 to $1521.10.
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