Gold has climbed above $1,800 an ounce to trade near its highest level in five months. The precious metal has benefited from a slightly weaker US dollar and expectations that the Federal Reserve will slow its rate of interest rate increases over the coming months.
Today brings the latest jobs data out of the US and after yesterday’s huge gains, gold and indeed markets more broadly are fairly static awaiting these employment figures. Strong numbers that point to a healthy US economy will give the Fed more bandwidth to continue its aggressive stance against stubbornly high inflation while any downside surprises will increase fears that this Fed aggression will tip the world’s largest economy into recession.
The fact that gold has been able to make significant gains in November and then carried that momentum into December illustrates the depth of support that has built up for the metal. The Fed is still after all almost certain to implement another interest rate hike later this month, which will increase the appeal of interest-paying assets to the detriment of gold.
The correlation therefore between gold’s gains and the shockwaves pulsing through the crypto industry following the collapse of FTX points to investors seeking out the age-old haven asset.
Rupert is a Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. He brings with him a breadth of experience in writing about energy and commodities having worked as an oil markets reporter and then precious metals reporter during the seven years he worked at Bloomberg News.
As well as market analysis, Rupert writes longer-form thought leadership pieces on topics ranging from carbon markets, the growth of renewable energy and the challenges of avoiding greenwash while investing sustainably.
This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.
