Gold prices experienced a slight dip on Thursday, January 9, as rising US bond yields and a stronger US dollar put downward pressure on the precious metal. Investors are awaiting key economic data from the United States to gain further insight into the Federal Reserve’s potential interest rate decisions for 2025.
As of 0038 GMT, spot gold was down 0.1% at $2,659.27 per ounce, while US gold futures rose by 0.2% to $2,677.10. The US dollar strengthened on Wednesday following a report suggesting that President-elect Donald Trump was considering emergency measures to implement a new tariff program. This came amid rising US bond yields, which also contributed to the stronger dollar.
Gold had surged to a near four-week high in the previous session, buoyed by weaker-than-expected US private employment data, which hinted that the Federal Reserve might take a less cautious approach to interest rate cuts in 2025. The ADP National Employment Report revealed that US private payrolls growth slowed significantly in December, with an increase of just 122,000 jobs, compared to 146,000 in November.
Market attention is now focused on the US jobs report, due on Friday, which could provide further clues about the Fed‘s monetary policy path. Minutes from the Fed’s most recent meeting indicated that policymakers expect inflation to continue moderating this year, though concerns remain about persistent price pressures, partly driven by the potential impact of President Trump’s economic policies.
Trump, who is set to take office on January 20, has proposed tariffs and protectionist measures, which could contribute to inflationary pressures. Gold, traditionally seen as a hedge against inflation, may see its appeal diminish in the face of high interest rates, which make non-yielding assets less attractive to investors.
In other market developments, gold-backed exchange-traded funds (ETFs) recorded their first inflow in four years, although their total holdings declined by 6.8 tonnes, according to the World Gold Council.
Meanwhile, other precious metals also saw declines. Spot silver fell by 0.3% to $30.03 per ounce, platinum dropped 0.5% to $951.34, and palladium dipped 0.5% to $924.
The market now looks to upcoming US economic data for further indications on how the Federal Reserve’s policies may evolve throughout the year.
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