Gold, the benchmark for precious metals, is trading higher as the Nasdaq Composite and S&P 500 are both showing signs of a drop. But gold is still outperforming the S&P 500, and its low price reflect the fact that the S&P 500 has not been able to keep up with its earnings expectations. Investors are expecting the S&P 500 to drop in the upcoming earnings season, so if the index fails to meet expectations, investors will likely sell. This is likely to cause gold’s price to rise, and the NFP numbers to fall.
The Federal Reserve is widely expected to raise interest rates in mid-year. This week, the Federal Open Market Committee (FOMC) meets to assess the economy and the outlook for inflation. Its most significant decision will be the rate decision. The strong US dollar may affect the decision, but the main factor may be the jobs report, which is released on Friday.
gold prices have been on the rise of late, and investors are looking towards the US non-farm payroll figures tomorrow. There is a decent chance the numbers are not very good, and this is already weighing on the gold price, as we saw when the numbers came out in the last few weeks.. Read more about gold price forecast 2023 and let us know what you think.
- Price Remains Close to Weekly Low
- Concerns about tapering and a focus on US data
- Other Precious Metals are also dipping in price.
As the NFP employment figures are expected later today, the price of gold has dropped considerably near the $1800 level, where it sits. Analysts believe the precious metal is about to face a difficult time, with COVID-19 cases remaining a worry, as well as increasing Fed tapering talk. The payroll statistics that will be released later today may be crucial in deciding the next steps. Silver prices were also below $26, while platinum prices were below $100 per ounce, a fresh 7-month low.
Weekly Low as Gold Recovers
The price of gold has been rising steadily in recent weeks, which is a good sign. The precious metal has risen week on week due to a weaker dollar and overall upbeat market mood. This was not the case as the price and precious metals dealers were nervous near the conclusion of the week. Gold has traded around $1800 in early European trading as traders remain cautious, with many market experts expecting at least short-term movements lower.
The weekly low comes as the United States continues to grapple with the recurrence of a COVID case. With over 100,000 new cases reported throughout the country, this is the largest amount in recent months. If the dollar’s strength continues to rise, gold prices will suffer and the market will become more volatile.
The Federal Reserve’s Policy and Job Numbers are Crucial
The NFP payroll figures will be the most significant news of the day for gold prices. Analysts anticipate a total of 845,000 jobs to have been created in the previous month, although there is less confidence surrounding this figure than normal, with a range of projections given. This ambiguity is mirrored in precious metal prices, which have been stagnant at best.
Traders seem to be waiting for the newest data, while worries about Fed policy and, in particular, tapering, which is anticipated to happen at some time, continue to grow. As reports continue to circulate, this moment may come closer than many anticipated. Any Fed policy statement in this respect is certain to affect prices along with the day’s major statistics.
Across the board, there is a sense of caution.
Gold prices haven’t been the only thing to plummet in recent days. Silver, platinum, and palladium have all been affected by the uncertainty surrounding precious metal pricing. In recent trading days, all of them have fallen a bit.
Silver prices have dropped over $1 in the past seven days, sitting just over $25. Palladium, on the other hand, is trading unchanged for the day. Platinum, however, has been the major mover in precious metals, with a substantial dip below $1,000. It is now trading at $999 per ounce, not much over its annual low.
For the week ahead, investors would be eyeing the U.S. non-farm payrolls data for clues on whether the Federal Reserve might raise interest rates in the near future. The data, due on Friday, may also help to shed light on the state of the economy, and whether the labor market is growing or shrinking.. Read more about gold price predictions and let us know what you think.
This article broadly covered the following related topics:
- non farm payroll
- nfp news
- what is nfp
- nfp forex
- nfp forex calendar