Gold Retreats After Payroll Surprise
Gold prices moved lower on Thursday after investors digested a stronger-than-expected U.S. jobs report that reduced the likelihood of a December interest rate cut. Spot gold declined 0.7 percent to $4,051.89 per ounce by early afternoon, while U.S. futures for December delivery slipped 0.8 percent to $4,051.90.
A firmer dollar added further pressure, making bullion more expensive for buyers outside the United States. The move reflected shifting sentiment across the metals market as traders recalibrated expectations ahead of the Federal Reserve’s next policy meeting.
Jobs Report Shifts Fed Expectations
The delayed Labor Department report showed September nonfarm payrolls rising by 119,000, more than twice the anticipated increase of 50,000. The data signaled a labor market that is cooling but still resilient, diminishing chances of near term monetary easing.
“This data essentially confirms what the Fed discussed in October — a slowing yet stable jobs market. A December rate cut now appears increasingly unlikely,” said Peter Grant, vice president and senior metals strategist at Zaner Metals. He noted that the shift in expectations added downward pressure on gold, which typically benefits when rates fall.
Traders now assign nearly a 40 percent probability to a rate cut next month, a notable decline compared with earlier projections. The shutdown-related delay also means the Bureau of Labor Statistics will combine the October and November employment readings, releasing both on December 16 after the Fed meets.
Fed Minutes Add Uncertainty
Minutes from the Federal Reserve’s October meeting, released on Wednesday, showed policymakers were divided on cutting rates. While the central bank ultimately moved ahead with a reduction, several officials cautioned that the decision could increase inflation risks and potentially undermine confidence in the Fed’s long-term strategy.
Despite recent fluctuations, gold remains one of the year’s standout assets. Prices have risen 55 percent so far, hitting an all-time high of $4,381.22 on October 20. Analysts cite geopolitical tensions, steady central bank purchases and strong ETF inflows as key drivers behind the metal’s remarkable rally.
Outlook and Broader Metals Market
UBS upgraded its mid-2026 gold target by 300 dollars to 4,500 per ounce, forecasting that U.S. rate cuts, geopolitical instability and sustained institutional demand will support higher prices over the medium term.
Other precious metals also traded lower. Spot silver dropped 1.9 percent to $50.34 per ounce. Platinum slid 2.4 percent to $1,509.10, while palladium edged down 0.1 percent to $1,378.45.
