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Gold prices near session highs as U.S. weekly jobless claims rise back above 200K, hitting a nine-week high

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(Kitco News) - The U.S. labor market lost momentum last week as the number of workers applying for first-time unemployment benefits jumped to a nine-week high.

The gold market is trading near session highs following the weak-then-expected weekly jobless claims numbers. April gold futures last traded at $1,825.80 an ounce, up 0.39% on the day.

Thursday, the U.S. Labor Department said weekly jobless claims jumped by 21,000 to 211,000, up from the previous week's unrevised estimate of 190,000 claims.

The latest labor market data missed expectations as economists were looking for claims to remain below 200,000 at around 195,000.

The four-week moving average for new claims – often viewed as a more reliable measure of the labor market since it flattens week-to-week volatility – rose by 4,000 claims to 197,000, up from the previous week's unrevised average of 193,000.

Continuing jobless claims, representing the number of people already receiving benefits, were at s 1.72 million during the week ending Feb. 25, rising by 69,000 from the previous week's revised level.

Investors remain laser-focused on U.S. employment data, a critical factor impacting the Federal Reserve's monetary policies. In his two-day testimony before Congress, Federal Reserve Chair Jerome Powell said that the labor market has to soften if inflation is to cool.

While didn't explicitly signal that the central bank is looking to raise interest rates by another 50 basis points later this month, Powell said that the central bank still has work to do.

"Nothing about the data suggests to me that we've tightened too much - indeed, it suggests that we still have work to do," Powell said in his testimony before Senate Banking Committee. "It's hard to make a case that we've over-tightened. It means we need to continue to tighten."

As a result of his latest hawkish comments, markets are now pricing in a nearly 78% chance of a 50 basis point rate hike on March 22.

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