Gold leapt back over $3300 an ounce in early morning trading after posting its first back-to-back weekly loss of the year as investors awaited direction from the Federal Reserve later this week. The bullion’s rise was sparked by a lower dollar and continuing uncertainties over the effects of the tariff war.
While the central bank is widely forecast to hold interest rates unchanged, market watchers will be looking for guidance on economic conditions and future indications for monetary policy
from Fed Chairman Jerome Powell’s comments and the statement issued by the Federal Open Market Committee after the policymakers’ meeting, which ends Wednesday.
June gold futures fell 1.7% last week to settle at $3,243.30 an ounce on Comex, though the front-month contract rose 0.7% Friday. Bullion increased 5.4% in April after gaining 11% in March and adding 0.5% in February. It’s up 23% so far this year. The metal rose 27% in 2024, its biggest annual gain since 2010. The June contract is currently up $78.4 (+2.42%) an ounce to $3321.70 and the DG spot price is $3317.20.
The yellow metal remained near recent record highs, however, the result of the yellow metal’s appeal as a haven against uncertainty, including market turbulence that has surrounded U.S. trade policy.
The broader market – including gold – rallied Friday after the closely watched U.S. monthly jobs report for April came in better than expected, signaling that the labor market remains resilient and may be able to withstand more economic pressures.
U.S. nonfarm payrolls grew by 177,000 in April, more than the 133,000 consensus forecast by economists. The figure dropped from March’s 228,000, though. The unemployment rate held at 4.2%, in line with expectations.
The Fed has been widely expected to continue interest rate cuts this year and has said that it closely watches both labor market and inflation data when setting monetary policy. The April jobs report will ease some of the pressure for quick rate cuts, however.
Most investors tracked by the CME FedWatch Tool now expect the Fed to begin interest rate cuts in July, not the May or June meetings. Lower interest rates are typically bullish for gold.
The Fed left rates unchanged at 4.25% to 4.50% at policymakers’ last meeting in March but reduced rates three times in 2024. The central bank began raising interest rates in March 2022 to fight inflation, ultimately imposing increases of by 5.25 percentage points before beginning rate cuts last year. Previously, the Fed had kept rates at 5.25% to 5.50% for a year.
Front-month silver futures fell 3.2% last week to settle at $32.26 an ounce on Comex, after the July contract lost 0.7% Friday. Silver dropped 5.2% last month after advancing 9.9% in March and retreating 2.4% in February. It gained 21% in 2024. The July contract is currently up $0.166 (+0.51%) an ounce to $32.425 and the DG spot price is $32.33.
Spot palladium gained 1.1% last week to $955.50 an ounce after rallying 0.7% Friday. Palladium fell 4.9% last month after rising 7.3% in March and retreating 10% in February. Palladium dropped 17% last year. Currently, the DG spot price is down $3.60 an ounce to $952.50.
Spot platinum decreased 0.6% last week to $969.70 after falling 70 cents Friday. Platinum retreated 3.1% in April after increasing 6.7% in March and sliding 4.7% in February. Platinum lost 8.4% in 2024. The DG spot price is currently down $3.20 an ounce to $967.80.
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