Gold falls more than 1% as chances of a rate reduction are raised by positive US employment statistics

 Gold falls more than 1% as chances of a rate reduction are raised by positive US employment statistics

At 2:15 p.m. ET (1915 GMT), spot gold had dropped 1.4% to $2,000.49 an ounce, having touched a low of $1,994.49 earlier in the session. So far, prices have dropped 3.4%, making this their lowest week in 10.

On December 8, gold dropped below $2,000 an ounce as speculators gambled on a US interest rate decrease by March in response to better-than-expected employment statistics, which also bolstered the currency and Treasury rates.

At 2:15 p.m. ET (1915 GMT), spot gold had dropped 1.4% to $2,000.49 an ounce, having touched a low of $1,994.49 earlier in the session. So far, prices have dropped 3.4%, making this their lowest week in 10.

At $2,014.50, US gold futures declined 1.6%.

Because of the acceleration of U.S. job creation in November and the decline in the unemployment rate to 3.7%, which indicates the strength of the labor market below, traders are placing bets that the Fed will lower interest rates in January of next year, the first of many rate cuts. Reservations might take up until May.

"Gold fell as the US employment report showed strength overall," independent metals dealer Tai Wong of New York said.

The storyline of the Fed meeting was altered by its closing below the all-time high of $150 on December 3. Currently, gold bulls are wishing for a successful Fed decision that would avert a downturn, if not a more severe one."

The 10-year Treasury yield increased from a three-month low throughout the week, while the dollar index climbed by 0.7%, increasing the cost of metal for overseas purchasers. [USD/] [US/]

Traders are waiting for the Fed's December 12–13 policy meeting to release its most recent interest rate estimates for the next year.

Ole Hansen, head of commodities strategy at Saxo Bank, said in a weekly report that "both silver and gold are likely to see periods where convictions could be challenged, given that markets are already significantly undervalued."

As record local prices hurt demand this week, physical gold dealers in India increased discounts to a seven-month high in an attempt to attract clients. [GOL/AS]

Spot silver has its lowest week since October 2022, down 3.3% to $23.00 an ounce.

Palladium dropped 2.44% to $945.94, while platinum increased 1.3% to $919.01. Each was scheduled for weekly drops.