Gold inched higher on Wednesday in the wake of the political turmoil in both South Korea and France, while the new US jobs data also helped to draw investors to bullion.
Spot gold gained 0.3% to $2,652.74 per ounce by 11:20 a.m. ET, extending on a 0.2% rise from the previous session. US gold futures were 0.4% higher at $2679.10 per ounce in New York.
Gold moved little on Tuesday after South Korean President Yoon Suk Yeol made a surprise declaration of martial law, before rescinding the decree just hours later. Opposition parties have since submitted a motion calling for his impeachment.
In France, President Emmanuel Macron called on lawmakers to reject a vote that would topple the government, sending the European nation deeper into a political crisis.
Meanwhile, the US released its latest jobs openings data, showing a stabilization of worker demand, though the number of jobs added fell below analyst expectations. The data, according to Bloomberg, is important for Federal Reserve officials who are trying to avoid any further weakening in the labor market as they gradually lower interest rates.
“Gold is seeing a muted reaction today, with a stronger impact expected from the upcoming US nonfarm payrolls and if data points to weakening employment it would support prices,” said Everett Millman, chief market analyst with Gainesville Coins.
Looking ahead, markets are focused on Fed chair Jerome Powell’s remarks later today, a pivotal payroll report due Friday, and next week’s inflation data for clues on the Fed’s policy trajectory.
Still bullish
Bullion has fallen more than 5% from a record high in late October, as the US dollar rallied following Donald Trump’s election win and tensions eased in the Middle East.
Still, the precious metal remains up by about 28% higher this year, supported by US monetary easing and central bank purchases.
JPMorgan Chase & Co. maintained its bullish outlook for gold in its 2025 year-ahead outlook, saying the post-election selloff “was a positioning-driven stumble, not a sea-change.” The bank forecasts gold will reach an average of $2,950 in the fourth quarter of next year.
A note from Marcus Garvey, head of commodities strategy at Macquarie, echoed a similar sentiment, forecasting gold could quickly challenge $3,000 an ounce as the Federal Open Market Committee brings rates down towards 4%.
Goldman Sachs sees even further upside, with US interest rate cuts and central bank purchases driving gold prices towards as high as $3,150 per ounce (in their bullish case scenario) by December 2025.
(With files from Bloomberg and Reuters)
Source: MINING.COM – Read More
