Gold prices tick higher with nonfarm payrolls, geopolitical tensions in focus

Gold prices rose slightly in Asian trade on Friday as investors sought more cues on U.S. interest rates from key payrolls data due later in the day, while geopolitical jitters helped spur some safe haven demand. 

The yellow metal was set for a muted finish to the week, as it was pressured by some uncertainty over the long-term direction of interest rates. Resilience in the dollar also weighed on broader metal markets. 

Spot gold rose 0.4% to $2,642.03 an ounce, while gold futures expiring in February rose 0.6% to $2,663.72 an ounce by 22:59 ET (03:59 GMT). 

On the geopolitical front, France’s government collapse and a failed attempt to impose martial law in South Korea kept some safe haven demand in play. Tensions in the Middle East, and between Russia and Ukraine also remained high.  Nonfarm payrolls awaited for rate cues 

Focus was now squarely on key nonfarm payrolls data for November, due later on Friday. The reading is expected to show a sharp rebound in payrolls growth from October, where disruptions due to hurricane activity battered the labor market.

Friday’s reading is likely to factor into the outlook for interest rate cuts. Strength in the labor market gives the Fed less impetus to cut interest rates.

The payrolls data also comes just weeks before the Fed’s final meeting for the year, where the central bank is expected to cut rates by 25 basis points. But recent comments from Fed officials, as well as the prospect of expansionary policies under incoming President Donald Trump, sparked doubts over rates in the coming years.

Fed Chair Jerome Powell recent flagged strength in the U.S. economy, but said that it also gave the Fed more headroom to consider further cuts. 

Higher for longer rates bode poorly for gold and other non-yielding assets, given that they increase their opportunity cost. 

Other precious metals rose on Friday but were also nursing losses through November. Platinum futures rose 0.7% to $951.55 an ounce, while silver futures rose 1.3% to $31.935 an ounce.  Copper rises on signs of tighter supplies; China data awaited 

Among industrial metals, copper prices were supported by reports that major copper miners had agreed to much lower processing fees for 2025, amid concerns over the availability of copper concentrate in spot markets.

A slew of key Chinese economic readings and events are also due in the coming week. Benchmark copper futures on the London Metal Exchange rose 0.5% to $9,136.0 a ton, while February copper futures rose 0.6% to $4.2235 a pound.

Chile’s Antofagasta (LON:ANTO ) and China’s Jiangxi Copper had agreed to substantially lower fees to process copper concentrate for 2025, Reuters reported. Fees usually tend to decline amid lower levels of concentrate in spot markets, indicating tight supplies.

A slew of key economic readings from top importer China are due next week, including inflation and trade data. China’s Central Economic Work Conference is also set to take place next week, offering up more cues on the economy and stimulus.

Source: Investing.com