(Kitco News) - Nothing appears to be stopping bullish momentum in the gold market, as prices hold above $5,500 an ounce even as the U.S. labor market remains relatively stable.
Initial claims for state unemployment benefits decreased by 1,000 to a seasonally adjusted 209,000 for the week ended Jan. 17, the Labor Department said Thursday. The data were relatively in line with expectations; according to consensus estimates, economists had forecast a rise to 206,000 claims. However, the previous week’s data were revised sharply higher to 210,000 claims.
The gold market is not paying any attention to the economic data as prices surge higher. Spot gold last traded at $5,507.20 an ounce, up more than 1% on the day. Gold continues to see solid follow-through buying following its biggest one-day gain against the U.S. dollar in history.
Sustained dollar weakness, geopolitical tensions, and strong demand for traditional stores of value have fueled the precious metal’s rally.
The four-week moving average for new claims—often viewed as a more reliable measure of the labor market because it smooths out week-to-week volatility—rose to 206,250, up from last week’s revised average of 204,000.
At the same time, laid-off workers continue to find a more favorable job-hunting environment. The report said continuing claims, published with a one-week delay, fell to 1.827 million, down 38,000 from the previous week’s revised level of 1.865 million.
“This is the lowest level for insured unemployment since September 21, 2024, when it was 1,825,000,” the report said.
On Wednesday, Federal Reserve Chair Jerome Powell said that the central bank’s monetary policy is well-positioned to take some time to see how economic activity unfolds through 2026.
The Federal Reserve kept interest rates unchanged in a range between 3.50% and 3.75% and is expected to maintain a neutral stance until at least June. Powell added that upside risks to inflation and downside risks to employment have both diminished slightly.
