Gold Slips as Strong U.S. Jobs Data and Rising Dollar

Gold markets opened the week under pressure as the U.S. dollar surged toward a six-month high, reshaping expectations ahead of the Federal Reserve’s December meeting. The combination of stronger-than-expected U.S. employment data and shifting interest rate expectations has left investors searching for direction, with gold experiencing renewed volatility.

Spot gold fell 0.62%, sliding to $4,043 per ounce, while U.S. gold futures moved slightly higher, rising 0.7% to $4,049.50 per ounce.
The decline in spot prices quickly translated into domestic pricing, with gram-gold down 0.63% at $5,516 in early morning trading. Other popular retail products also reflected softer sentiment, with quarter gold, Republic gold, and full gold items trading lower in parallel with the global move.

Stronger U.S. Data Disrupts Market Balance

The latest U.S. labor report significantly exceeded expectations, with nonfarm payrolls growing by 119,000 in September—more than double the estimated figure. This data reinforced the view that the Federal Reserve may pause rate cuts at its December meeting, a shift that directly impacts gold’s outlook.

A stronger dollar makes gold more expensive for holders of other currencies, thereby softening global demand. As the U.S. Dollar Index approached its strongest level in six months, gold faced renewed pressure, erasing earlier gains.

Complex Messages From the Federal Reserve

Recent Federal Reserve minutes painted a mixed outlook. Although the central bank had already initiated a rate cut, policymakers highlighted persistent risks, including sticky inflation and weakening public confidence.

Adding to market uncertainty, the U.S. government shutdown delayed specific labor statistics beyond expectations. The backlog revealed a labor market that remains more resilient than anticipated.

At the same time, U.S. manufacturing activity fell to its lowest level in four months in November, underscoring the economic strain from tariff-related pressures. This contrast, strong hiring but weak manufacturing, has complicated expectations surrounding monetary policy.

Analysts Warn of Key Technical Levels

Analysts noted that the dollar’s climb above the 100 level continues to weigh heavily on gold. According to market commentary, spot gold may retest the $3,995 support zone, and a decisive break below this level could open the way toward $3,937.

Technical models indicate that gold is attempting to hold above its upward trendline. However, the most recent rebound from $4,022 appeared weaker than the earlier rally from $3,988.

Should gold break above the $4,101 resistance, analysts suggest the trend beginning at $3,998 could extend toward the $4,170–$4,243 region.

Market tools reflect this uncertain backdrop. According to the CME FedWatch Tool, the probability of a December rate cut dropped to 69%, down from 74% the previous session, indicating shifting investor expectations.

Broader Geopolitical Environment Provides Limited Support

Market watchers note that geopolitical support for gold has weakened in recent weeks. Analysts expect gold to maintain a sideways-to-negative profile over the next three to five weeks unless new global risk drivers emerge.

Meanwhile, U.S. and Ukrainian officials are reported to be working on an updated framework to bring the conflict with Russia closer to de-escalation. Reduced geopolitical tensions typically diminish safe-haven demand, further moderating gold’s trajectory.

Other Precious Metals React to Market Movements

Gold’s volatility echoed across the broader precious metals market:

• Spot silver fell 0.3% to $49.86

• Platinum gained 1.1% to $1,527.25

• Palladium rose 0.7% to $1,384.18

Each metal displayed its own sensitivity to currency fluctuations and shifting risk appetite, though none matched the volatility seen in gold.

A Market Waiting for Clarity

As the next Federal Reserve meeting approaches, investors remain on the lookout for any signals that could shift expectations for monetary policy. The interplay between strong economic data, a mighty dollar, and mixed macroeconomic indicators has created a delicate environment where gold could swing sharply in either direction.

For now, the market’s tone remains cautious, reflecting a landscape shaped by stronger U.S. fundamentals and a currency environment unfavorable to gold.