RPMEX: January 10, 2025
Gold prices are on course for their strongest week in seven, hitting a four-week high on Friday. This uptick is driven by growing safe-haven demand amid heightened uncertainty surrounding the policies of the incoming administration.
Recent economic data has revealed significant job growth in December, with nonfarm payrolls rising by 256,000, far exceeding expectations. This surge in jobs is a critical indicator for Federal Reserve policymakers, as they assess the need for future monetary policy adjustments. The minutes from the most recent Federal Reserve meeting raised concerns that the new administration’s policies could contribute to inflationary pressures, adding to the complexity of future policy decisions.
Despite the positive jobs report, the ADP Employment Report showed that private sector job additions were weaker than expected in December, with only 122,000 new positions, below the forecasted 136,000. Meanwhile, weekly jobless claims dropped to an 11-month low, signaling continued strength in the labor market.
Gold futures for February gained 0.7% on Thursday, closing at $2,690.80 an ounce, and have increased by 1.4% for the week. After a strong 2024, with a 27% rise—the largest annual gain since 2010—gold remains a sought-after asset. The current February contract is trading at $2,722.30 an ounce, while the spot price sits at $2,695.20. Gold’s performance in 2024 was fueled by monetary policies, economic conditions, and central bank activity globally.
The Federal Reserve has reduced its benchmark interest rates three times since September, most recently bringing them to a range of 4.25% to 4.50%. Higher interest rates typically place downward pressure on gold, as they increase the appeal of other interest-bearing investments. Currently, market expectations suggest that the Fed will maintain rates at the end of this month, with the majority of investors anticipating no changes.
Silver futures also showed strength, rising 1.1% on Thursday to $31.02 an ounce. The March contract has gained 3.2% in the first part of the week. Despite a decline in December, silver ended 2024 up 21%. The March contract is now priced at $31.35 an ounce, and the spot price is $30.52.
Palladium and platinum prices saw modest gains on Thursday. Palladium rose by 0.1% to $942.50 an ounce, while platinum increased by 0.4% to $967.10. These metals have faced challenges in recent months, with palladium down 17% in 2024 and platinum sliding by 8.4%.
Disclaimer: This editorial content is provided for informational purposes only and should not be construed as investment advice or a recommendation to engage in any specific financial transactions. The views expressed herein may not reflect the position of of RPMEX and or it’s affiliates. Always consult with a financial advisor before making any investment decisions, as market conditions can change unpredictably.