Gold News

Comex Gold Trading Sees Price Near $2200, Breaks £1700 and €2000

A SURPRISE rise in US unemployment in Friday's jobs data for February saw the price of gold spike to a fresh all-time high in spot-market trading, coming within $5 per Troy ounce of $2200 and breaching £1700 for UK investors while topping €2000 in Euro terms for the first time ever, as betting grew that the Federal Reserve will start cutting Dollar interest rates in June.
Peaking at $2195 per Troy ounce as London's physical market closed – leaving US Comex futures and options trading to set the price – the precious metal had earlier set its 5th London 3pm gold benchmark record in a row, a run of new all-time highs not seen since the Covid Crisis of summer 2020, above $2171.
Gold had earlier spiked to a then-new record high of $2185 in London spot trading after the US Bureau of Labor Statistics said the world's largest economy added 250,000 jobs to non-farm payrolls in February, beating analysts' consensus forecasts by more than 1/3rd.
But with average wage growth slowing unexpectedly, the BLS also revised down the jobs growth it had previously reported for January and December, slashing that 2-month total by almost 25%.
Together, that pushed up the US unemployment rate to 3.9%, its highest in more than 2 years.
Betting on a June rate cut from the Federal Reserve grew towards 4-in-5 positions in interest-rate futures contracts – up from 3-in-4 before today's non-farm jobs report – and the market's consensus bet for Christmas 2024 moved to predict that Fed rates will end the year below 4.44% per annum.
That's down by 0.17 points from Wednesday last week, when it briefly matched the US central bank's own end-2024 forecast of 4.60%.
Chart of gold priced in US Dollars (inverted, right axis) against market and US Fed expectations for end-2024 interest rates. Source: BullionVault
"Respect the cold-hearted rally" in gold prices, says a trading note from strategist Nicky Shiels at Swiss bullion refining and finance group MKS Pamp.
"It's so clear there is a persistent stealth buying program in place give price action [because] ALL the known flows this past week have been sales," she says, pointing to gold ETFs plus further physical selling and also mining-producer hedging to lock in these new record prices for future output.
The US Dollar fell Friday for the 5th session running, hitting its lowest trade-weighted DXY index level in 8 weeks.
New York stock markets rose alongside gold, as did bond prices, edging down longer-term borrowing costs  to their lowest in a month at 4.09% per annum on 10-year US Treasury debt.
Ten-year TIPS yields – the so-called 'real rate' strongly correlated against the gold price across many periods in recent years – ticked down to 1.80%, its lowest since the end of January.
So-called cryptocurrency Bitcoin also scored another all-time high, just topping Tuesday's peak and coming within $70 of $69,000 as BTC ETF trust funds continued to attract inflows.

Adrian Ash

Adrian Ash, BullionVault Gold News

Adrian Ash is director of research at BullionVault, the world-leading physical gold, silver and platinum market for private investors online. Formerly head of editorial at London's top publisher of private-investment advice, he was City correspondent for The Daily Reckoning from 2003 to 2008, and he has now been researching and writing daily analysis of precious metals and the wider financial markets for over 20 years. A frequent guest on BBC radio and television, Adrian is regularly quoted by the Financial Times, MarketWatch and many other respected news outlets, and his views from inside the bullion market have been sought by the Economist magazine, CNBC, Bloomberg, Germany's Handelsblatt and FAZ, plus Italy's Il Sole 24 Ore.

See the full archive of Adrian Ash articles on GoldNews.

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