Global gold markets remained steady on Friday as investors waited for fresh economic signals before making major moves. While a weaker U.S. dollar normally supports gold, the boost was largely offset by rising Treasury yields, keeping price action muted ahead of next week’s Federal Reserve policy meeting.
Trading activity suggested that gold prices were still in a consolidation phase after a brief rally in November, with the market waiting for new catalysts from upcoming economic data.
Gold Prices Stay Rangebound Under Pressure from Higher Yields
In early Asian trading, spot gold hovered around $4,215.92 per ounce, on track for a modest 0.3% weekly decline. Meanwhile, December gold futures inched higher, rising 0.1% to $4,245.70 per ounce.
Rising 10-year U.S. Treasury yields have been a key factor preventing a stronger move higher in gold prices. When yields increase, interest-bearing assets become more attractive compared to gold, which does not pay interest.
At the same time, the U.S. dollar remained near a five-week low against major currencies, helping make gold cheaper for overseas buyers. This would normally support gold prices, but the upward momentum has been limited by bond market dynamics.
Kunal Shah, head of research at Nirmal Bang Commodities, said the market is simply waiting for new drivers.
“The market is looking for fresh triggers. Gold is currently consolidating after a brief run in November, but the overall trend still looks positive,” he said.
Still, he noted that stronger bond yields continue to weigh on gold prices, even as the dollar weakens.
U.S. Economic Data in Focus Before the Federal Reserve Meeting
Recent U.S. labor data sent mixed signals. Jobless claims fell sharply to 191,000 last week, the lowest level in more than three years and well below expectations of 220,000. However, private payrolls dropped by 32,000 in November, the steepest decline in more than two and a half years.
This contrast suggests a cooling labor market, even if headline unemployment numbers remain strong.
A Reuters poll of more than 100 economists showed that most expect the Federal Reserve to cut interest rates by 25 basis points at its December 9–10 meeting. The move would be aimed at supporting an economy that appears to be slowing, especially in the job market.
Also read: Gold Prices Hold Firm While Silver Surges to All-Time High Ahead of Fed Decision
Lower rates are typically supportive for gold prices, as they reduce the appeal of interest-bearing assets. In a lower-yield environment, gold becomes more competitive as a safe store of value.
Inflation Data Will Decide the Next Move for Gold Prices
All eyes are now on the release of the delayed Personal Consumption Expenditures (PCE) Index, scheduled for 15:00 GMT. The PCE report is the Federal Reserve’s preferred measure of inflation and could play a major role in shaping the rate decision next week.
If inflation is easing, expectations for a rate cut will strengthen, likely pushing gold prices higher. If the report shows persistent inflation, policymakers may remain cautious.
For the moment, the gold market is in “wait-and-see” mode. Traders have avoided taking large positions before such a crucial data release.
Silver Hits Record, Palladium Rises
Other precious metals also saw notable swings:
- Silver rose 1% to $57.68 per ounce, heading for a weekly gain after briefly hitting a record high of $58.98 on Wednesday.
- Platinum slipped 0.1% to $1,644.04 per ounce, and is on track for a weekly loss.
- Palladium gained 1.1% to $1,464.70 and is poised to end the week higher.
The surge in silver has been partly driven by industrial demand and speculative buying, while platinum and palladium followed broader market sentiment tied to interest rates and the dollar.
Also read: Silver and Gold Prices Climb Sharply on Anticipation of Fed Interest Rate Cuts
With the dollar softening and rate-cut expectations rising, analysts believe gold prices still have room to move upward in the coming weeks. The direction, however, will depend heavily on inflation data and the Federal Reserve’s tone.
If the PCE report shows declining price pressures, a rate cut becomes more likely, and that could be a strong catalyst for gold prices.
For now, the market remains cautious. The next few days could determine whether gold breaks higher or remains stuck in its current range, but one thing is clear: gold remains firmly on the radar of global investors.
