Gold traded flat below $2,050 on anticipation of nonfarm payroll figures
Gold muted on Friday following a strong dollar recovery during this week that caused it to slump beyond key levels, attention is now firmly focused on important U.S. labor market figures for additional hints about interest rate reductions in 2024.
Spot gold advanced by 0.1% to $2,045.41 per ounce, meanwhile gold futures climbed by 0.1% to $2,052.05 per ounce. The two instruments dipped with an average from 0.8% to 1% during the week.
In the week that followed a significant melt-up around the wrap up of 2023, gold was suffering from some dips. Due to profit-taking and mounting doubts about the Fed’s intentions to lower interest rates this year, the surge however was unable to hold.
The minutes of the Federal Reserve's December meeting provided few hints as to when the bank intended to start lowering rates, so the markets somewhat reduced their wagers that rate reductions may start as early as March 2024.
The dollar saw strong gains as a result of this trend, and it is now expected to gain more than 1% each week for the first time since July 2023.
Now, all eyes were on the nonfarm payroll figures for December, which were scheduled for release during the day. Although traders were cautious due to unpredicted strength following stronger-than-anticipated weekly jobless claims and private payrolls figures issued earlier this week, the figure is projected to suggest further slowdown in the labor market.