In a session marked by heightened anxiety over the Federal Reserve’s monetary policy, gold prices experienced a downward trend on Wednesday, October 4. Concerns lingered that the central bank might maintain elevated interest rates for a more extended period than previously anticipated, casting a shadow over precious metals.
Gold futures recorded a decline of $6.70, representing a 0.36% decrease, concluding the day’s trading at $1,834.80 per ounce. Concurrently, silver saw a drop of 23.10 cents, or 1.08%, settling at $21.146 an ounce. Platinum futures followed suit, falling by $5.40, equivalent to a 0.61% reduction, to close at $874.20 per ounce. Palladium, too, witnessed a decline, plummeting $20.90, or 1.75%, and settling at $1,172.00 per ounce.
The downward spiral in gold futures marked the eighth consecutive day of negative performance, with investors increasingly concerned about the Federal Reserve’s potential prolongation of high interest rates.
Nonetheless, certain positive factors have emerged, including a weakening U.S. dollar and a deceleration in U.S. bond yields. These developments have offered a modicum of relief to gold contracts, which have otherwise been mired in pessimism. Reports of a slowdown in the 10-year U.S. bond yield, reaching its highest level in 16 years, followed the release of lower-than-expected U.S. private sector employment numbers. This unexpected drop in employment figures helped alleviate apprehensions regarding the Federal Reserve’s interest rate stance.
Automatic Data Processing Inc. (ADP) disclosed that U.S. private sector employment expanded by a mere 89,000 jobs in September, a figure well below analysts’ predictions of 160,000 jobs and a reduction from the 180,000 jobs added in August.
Investor attention remains firmly fixed on U.S. labor data for further insights into the Federal Reserve’s prospective interest rate trajectory. Today, the United States is slated to unveil the weekly jobless claims numbers, which will serve as another gauge of the economic landscape. On Friday, non-agricultural employment figures for September will be unveiled.
Analysts are forecasting a rise of 163,000 jobs in non-agricultural employment for September, following the addition of 187,000 jobs in August. Additionally, the unemployment rate is expected to dip to 3.7% in September, down from 3.8% in August. These figures will provide crucial insights into the economic outlook and the potential course of the Federal Reserve’s interest rate policies in the coming months.
The Spot Market is Open
Thursday, October 5, 2023