(Kitco News) - Bullish momentum in the gold market continues to grow with prices trading near session highs as the U.S. labor market loses momentum with the number of jobs available dropping more than expended in December.
December job openings, a measure of labor demand, dropped to 7.60 million from November’s reading of 8.16 million, according to the Labor Department's monthly Job Openings and Labor Turnover Survey (JOLTS) report. The report was weaker than expected, as economists were forecasting a relatively unchanged reading.
Greg Michalowski, Currency Analyst and Director of Client Education at ForexLive, noted that the number of job openings fell to 7.443 million, the lowest level since September 2024. The September 2024 low was the lowest level since February 2021.
The gold market has seen solid gains since the start of the new year and it continues to attract solid safe-haven flows. Spot gold futures last traded at $2,838.40 an ounce, up 0.77% on the day.
Gold has seen higher volatility in recent weeks as it remains caught between the Federal Reserve’s growing hawkish monetary policy stance and growing geopolitical and economic instability.
Last week Federal Reserve Chair Jerome Powell said that the central bank was in no rush to raise interest rates as inflation risks start to rise and the labor market remains healthy.
According to some analysts, the JOLTS data could put the Federal Reserve in a difficult position as the report shows slowing momentum in the labor market. This could force the Federal Reserve to maintain its easing cycle even as inflation remains elevated. Some analysts have said that gold should do well in an environment of slowing economic growth and higher inflation.
Delving deeper in to the report, in December, hires and total separations were little
changed at 5.5 million and 5.3 million, respectively. Within separations, quits increased slightly to 3.2 million, while layoffs and discharges remained steady at 1.8 million.
