Gold pressured by strong dollar, sees resilient safe-haven demand

8 Ocak 2025

Today market analysis on behalf of Bas Kooijman is the CEO and Asset Manager of DHF Capital S.A

Gold prices showed limited movements today and experienced some pressure due to a strengthening US dollar and high Treasury yields. Gold could continue to see some risks following an increase in U.S. job openings, which highlighted the continued resilience in the labor market. ISM services data also revealed an acceleration in activity and rising prices, fueling concerns about persistent inflation and dampening expectations for significant rate cuts by the Federal Reserve. Market participants are now keenly awaiting Friday’s U.S. nonfarm payrolls report for additional insights into the Fed’s potential policy direction, while today’s ADP employment numbers and the Federal Reserve’s December meeting minutes remain crucial focal points for investors.

Despite these challenging market conditions, gold could continue to benefit from ongoing uncertainty surrounding trade policies and their potential impact on global stability. Additionally, central bank demand remains a significant supportive element, as evidenced by recent data showing the People’s Bank of China (PBoC) has increased its gold reserves for two consecutive months. Furthermore, persistent geopolitical tensions continue to provide underlying support for gold prices.

 

Zaid Barem / ymm