Gold prices on track for weekly gain; US data on tap

GOLD prices remained stable on Friday (Jan 10) during early Asian hours, poised for their strongest week since mid-November, as investors awaited US jobs data to gauge how aggressively the Federal Reserve might cut interest rates this year.

Spot gold was unchanged at US$2,670.16 per ounce, as at 0044 GMT. Bullion has gained more than 1 per cent so far this week.

US gold futures edged 0.1 per cent higher to US$2,694.50.

Investors will closely watch the key government payrolls report scheduled for release at 8.30 am ET. According to a Reuters survey, non-farm payrolls are expected to have increased by 160,000 jobs in December, following a jump of 227,000 in November.

The bullion strengthened to a nearly four-week high in the previous session, supported by safe-haven demand, while investors weighed how US president-elect Donald Trump’s policies would impact the economy and inflation.

Trump will return to office on Jan 20 and his proposed tariffs and protectionist policies are expected to fuel inflation.

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Kansas City Federal Reserve president Jeff Schmid signalled on Thursday a reluctance to cut interest rates again as the US central bank comes into the new year facing a resilient economy and inflation that remains above its 2 per cent target.

Bullion is used as a hedge against inflation, although higher interest rates reduce the appeal of holding non-yielding bullion.

Top consumer China’s consumer inflation slowed in December, while producer price deflation persisted, as Beijing ramped up policy support to bolster a faltering economy.

Spot silver shed 0.1 per cent to US$30.12 per ounce, platinum dropped 0.1 per cent to US$957.98 and palladium added nearly 1 per cent to US$934.28. All three metals were headed for a weekly gain. REUTERS

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