Gold prices rose in the Asian trade on Friday as investors waited for cues from the release of the US non-farm payrolls data later in the day.
Geopolitical tensions also spurred safe-haven demand for gold, boosting prices.
Gold prices on COMEX had dipped to a low of more than a week earlier in the session on Friday.
However, prices have recouped the losses and are currently over $2,660 per ounce.
At the time of writing, the February gold contract on COMEX was $2,664.19 per ounce, up 0.6% from the previous close.
Investors will be waiting for the key nonfarm payroll data from the US later in the day as it is one of the preferred gauges for the Federal Reserve to assess the country’s economic health.
Haresh Menghani, editor at FXstreet, said in a report:
Any meaningful appreciating move, however, seems elusive ahead of the US Nonfarm Payrolls (NFP) report, which will be looked upon for the interest rate outlook in the US and provide a fresh impetus to the non-yielding bullion.
On the geopolitical front, political turmoil in France and South Korea has kept safe-haven inflows into gold. Tensions in the Middle East, and between Russia and Ukraine also remained high.
Focus on economic data
“The closely watched US jobs data will guide the Federal Reserve (Fed) policymakers on their next monetary policy decision later this month, which, in turn, will drive the US Dollar (USD) and provide some meaningful impetus to the non-yielding gold price,” Menghani said.
Along with the nonfarm payroll data, traders will also be eyeing the unemployment rate in the US, which will provide the number of unemployed people in the country.
Both data come out ahead of the much-anticipated US Fed’s policy meeting on December 17-18.
According to the CME FedWatch tool, traders are pricing in a 71.8% probability of the US central bank cutting rates by 25 basis points later this month.
Source: CME Group
There have been concerns that the US Fed may slow down the rate-cut cycle as the US economy remains resilient.
Recent comments from Fed Chair Jerome Powell suggested that the central bank will be cautious with its approach to future rate cuts.
Elevated interest rates weigh on demand for gold as it is an unyielding commodity, unlike bonds.
Copper rises on tight supplies
Meanwhile, copper prices on the London Metal Exchange rose on Friday as miners had agreed to much lower processing fees for 2025, amid concerns over the availability of the copper concentrated in spot markets.
Chile’s Antofagasta and China’s Jiangxi Copper had agreed to substantially lower fees to process copper concentrate for 2025, Reuters reported.
Fees usually tend to decline amid lower levels of concentrate in spot markets, indicating tight supplies, according to the Reuters report.
Next week, China is expected to release inflation and trade data.
China’s Central Economic Work Conference is also scheduled for next week, which will provide more cues on stimulus packages.
China is the top consumer of base metals, particularly copper.
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