On Friday (December 5), in the Asian market early session, spot gold slightly fell, currently reported around $4200 per ounce. On Thursday (December 4), spot gold prices remained basically stable, as rising U.S. bond yields offset the support from a weak dollar. The market is waiting for the U.S. PCE inflation data to be released on Friday, looking for clues about the Fed's policy outlook before the December decision meeting.
Gold prices withstand the 'dual pressure' of the dollar and U.S. bonds, as the market awaits U.S. PCE inflation data!
Spot gold closed slightly up 0.13% on Thursday, at $4208.70 per ounce.
The yield on the U.S. 10-year Treasury rose by 4 basis points to 4.104%. The U.S. real yields, which have a negative correlation with gold prices, also rose by 4 basis points to 1.864%, limiting the rise in gold.
Marex analyst Edward Meir said: 'The rise in U.S. Treasury yields has partially limited the upside potential for gold, but the movement of the dollar index provides some support.'
The dollar index has reached a one-month low, making it easier for overseas buyers to afford gold.
U.S. jobless claims hit a low point, showcasing labor market resilience.
Data released by the U.S. Department of Labor on Thursday became the market focus, with initial jobless claims unexpectedly dropping to 191,000, the lowest level in over three years, far below the economists' expectation of 220,000. This decline of 27,000 alleviated previous concerns about a sharp deterioration in the labor market.
Although the Thanksgiving holiday may lead to increased difficulty in data adjustments, resulting in lower readings, this weekly report is still regarded as the most timely indicator of economic health.
The number of applicants not seasonally adjusted plummeted by nearly 50,000 to 197,221, far exceeding model expectations, mainly concentrated in California, Texas, and New York. Meanwhile, the number of continuing jobless claims also decreased by 4,000 to 1,939,000. Although it remains high, it overall indicates that the labor market is maintaining a status quo and has not fallen into the danger of stagnation.
It is worth noting that other independent surveys, such as the ADP report, show that November's employment fell by 32,000, marking the largest decline in over two and a half years, while Revelio Labs' estimate indicates a decrease of 9,000 jobs in November. Although these data present a mixed picture, they reinforce the market's perception of economic resilience.
Economist Christopher Rupkey believes that other alternative statistics may exaggerate the softness of the labor market, and the Federal Reserve needs to recheck the data to avoid misjudging the economic growth outlook.
In addition, the Challenger, Gray & Christmas report shows that the planned layoffs in November decreased by 53% to 71,321 compared to the previous month. Although this is 24% higher than the same period last year, the cumulative layoffs this year have reached 1.171 million, mainly concentrated in the technology sector, influenced by the introduction of artificial intelligence. This series of data indicates that the U.S. labor market is in a 'no layoffs, no hiring' equilibrium state, where reduced supply and uncertainty in trade policies have further weakened demand, especially for entry-level positions and small business hiring. The unemployment rate is expected to rise steadily, with the Chicago Fed estimating it to be around 4.4% in November, providing more support for the Federal Reserve's policies.
The U.S. PCE inflation data is about to come out.
Investors are currently closely watching the U.S. September PCE price index report to be released on Friday, which is the Federal Reserve's preferred inflation indicator.
On Friday at 23:00 Beijing time, the U.S. Bureau of Economic Analysis will publish the September personal consumption expenditures (PCE) price index, which is bound to trigger significant fluctuations in the financial markets.
Economists expect that the U.S. September PCE price index year-on-year is likely to increase by 2.8%, up from the previous value of 2.7%; the U.S. September core PCE price index year-on-year is likely to increase by 2.9%, consistent with the previous August figure of 2.9%.
As the Federal Reserve's preferred inflation indicator, the core PCE price index year-on-year change has a significant impact on policymakers.
According to LSEG data, traders have bet on nearly a 90% chance that the Federal Reserve will cut interest rates by 25 basis points next week.
Analysts point out that the biggest short-term risk facing gold is if PCE data exceeds expectations. If inflation unexpectedly rises, it could boost the dollar and temporarily suppress gold.
Corpay market strategist Karl Schamotta stated: 'Traders are making significant bets that the Federal Reserve will cut rates and avoid releasing overly hawkish information at next week's meeting.'
In addition to the PCE inflation data, investors will also focus on U.S. consumer confidence data.
On Friday at 23:00 Beijing time, the preliminary value of the U.S. December Michigan University Consumer Confidence Index will be released, expected to be 52.0.
In addition, U.S. President Trump's trade policies and the suspense surrounding the Federal Reserve chair successor have further increased uncertainty. White House economic advisor Hassett is viewed as a strong candidate, and if he takes office, he may push for more aggressive rate cuts to align with Trump's preferences, which has raised concerns among bond investors towards the Treasury.
Gold prices withstand the 'double pressure' from the dollar and U.S. Treasury, as the market awaits U.S. PCE inflation data!
Gold trading analysis
FXStreet analyst Christian Borjon Valencia pointed out that gold prices remain tilted upwards, with the daily closing price above $4,200 per ounce, laying the foundation for the rise in gold prices. The Relative Strength Index (RSI) is still bullish but has flattened slightly, indicating that the market may be in a consolidation phase, and traders are waiting for new catalysts.
Valencia stated that if the gold price breaks through $4,250 per ounce, it may attempt to hit $4,300 per ounce, with the next target being the historical high of $4,381 per ounce.
On the other hand, Valencia added that if the gold price falls below $4,200 per ounce, the next support level is the 20-day simple moving average (SMA) of $4,124 per ounce, followed by $4,100 per ounce, and finally the 50-day moving average of $4,059 per ounce.
[Today's key economic data and events to watch]
(1) 15:00 U.K. November Halifax seasonally adjusted house price index month-on-month
(2) 15:45 France October industrial output month-on-month
(3) 15:45 France October trade balance
(4) 18:00 Eurozone Q3 GDP year-on-year revised value
(5) 18:00 Eurozone Q3 seasonally adjusted employment quarter-on-quarter final value
(6) 21:30 Canada November employment figures
(7) 23:00 U.S. September core PCE price index year-on-year
(8) 23:00 U.S. December one-year inflation rate preliminary value
(9) 23:00 U.S. September personal spending month-on-month
(10) 23:00 U.S. December Michigan University Consumer Confidence Index preliminary value
(11) 23:00 U.S. September core PCE price index month-on-month
(12) Next day 02:00 U.S. total oil rigs as of December 5 #比特币VS代币化黄金 #RWA总规模持续增长 #ETH走势分析 #加密市场观察 #美联储重启降息步伐
