Gold prices slide: Rate cut hopes fade; silver, platinum fall dip
Gold prices declined on Friday as strong US labor market data reduced expectations of an early interest rate cut by the Federal Reserve. Easing geopolitical tensions also lowered demand for safe-haven assets. Despite the fall, gold was still headed for a weekly gain, while silver, platinum, and palladium also posted losses.
Gold prices down
Gold prices moved lower on Friday, giving up some gains after hitting record highs earlier in the week. Investors turned cautious as new US data showed the economy remains strong, reducing expectations that interest rates will be cut soon. Spot gold fell 0.2% to $4,604.29 per ounce. US gold futures for February delivery declined 0.3% to $4,608.90 per ounce. On Wednesday, gold had reached an all-time high of $4,642.72. Despite the drop, gold was still on track to rise about 2% for the week.
Labor Department data
Pressure on gold prices increased after data from the US Labor Department showed weekly jobless claims fell to 198,000. This was well below market estimates and pointed to continued strength in the labor market. The data pushed the US dollar higher for a third straight week. A stronger dollar makes gold more expensive for buyers outside the US. Gold also does not earn interest, so it tends to lose appeal when interest rates are expected to stay high. Market analysts said the latest data suggests there is no urgent need for the Federal Reserve to cut rates.
Global tensions
Gold also faced pressure as global tensions showed signs of easing. Reports indicated that protests in Iran had slowed in recent days. At the same time, US President Donald Trump used softer language on possible military action against the country. When global risks appear lower, investors often reduce exposure to safe-haven assets like gold. This shift in sentiment added to the decline in prices. Still, some signs of support remained. Holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose slightly to 1,074.80 tons. This marked the highest level in more than three and a half years.
Other metals
Silver prices dropped sharply to 1.8% to $90.66 per ounce. Even so, silver was still set for a weekly gain of more than 13% after reaching a record high of $93.57 in the previous session. A recent report said that silver has become one of the most crowded trades in the market, driven mainly by strong buying from individual investors. Other precious metals also declined. Spot platinum fell 2.1% to $2,358.95 per ounce. Palladium dropped 2.9% to $1,748.50 per ounce after hitting a one-week low earlier in the day.