Gold Steady as Markets Brace

Market analysis on behalf of Bas Kooijman, CEO and Asset Manager of DHF Capital.

Gold Steady as Markets Brace for Fed Minutes and Key NFP Data

Gold traded steadily on Wednesday, with investors adopting a wait-and-see stance ahead of the Federal Reserve’s minutes later today and the highly anticipated nonfarm payrolls report due on Thursday. With traders assigning a 46% probability to a December rate cut, uncertainty over the policy outlook has kept bullion confined to a narrow range.

Labor-market signals have offered mixed clues. The release of initial jobless claims, the first official update since the federal shutdown began in early October, showed filings rising to 232,000 for the week ending October 18, well above the 223,000 expected. Continuing claims climbed to 1.957 million, further pointing to a soft labour market. Still, markets are focusing on tomorrow’s NFP, where payrolls are expected to rebound to 50,000 from 22,000, while unemployment is seen steady at 4.3%. A weaker-than-expected print would likely revive rate-cut expectations, pressuring treasury yields while supporting gold. Conversely, stronger numbers could weigh on the metal.

Geopolitical developments continue to provide a layer of support. Tensions between Russia and Ukraine remain elevated, which could support demand for gold in addition to the ongoing risks in the Middle East.

Zaid Barem / ymm