The gold price (XAU/USD) relinquished its intraday gains entirely as United States labor market conditions displayed broad improvement. Positive data from the US Automatic Data Processing (ADP) Employment Change for December and weekly jobless claims ending December 29 contributed to the shift. Private US employers surpassed expectations by hiring 164,000 workers, compared to the anticipated 115,000 and the previous reading of 103,000. Additionally, the US Department of Labor reported a decline in initial jobless claims to 202,000, beating the consensus of 216,000 and the previous reading of 220,000.
The overall sentiment regarding the Gold price remains positive, supported by the heightened expectations of rate cuts from the Federal Reserve (Fed) following the release of the Federal Open Market Committee (FOMC) minutes. However, uncertainty lingers on the exact timing of the Fed’s rate cut announcement, introducing potential volatility to the Gold market.
Despite concerns about policy over-tightening, robust economic prospects for the United States could lead Fed policymakers to delay a rate cut announcement, contrary to market expectations. Looking ahead, investors should brace for heightened volatility as the US Nonfarm Payrolls (NFP) report is scheduled for release on Friday.
