Spot gold rose 0.6% to $3,372.70 per ounce by 10:30 a.m. ET, moving closer to the one-month high touched earlier this week. Meanwhile, the most actively traded futures contract in New York gained 0.5% to reach $3,395.10 per ounce.
Labor Market Woes Amplify Economic Concerns
The uptick in gold prices followed the release of weak U.S. private sector jobs data, which showed the worst monthly growth in several years. The ADP National Employment Report revealed that private employers added only 37,000 jobs in May, well below expectations and a sign that the labor market could be cooling faster than anticipated.
This data added to broader concerns about the resilience of the U.S. economy, which is still contending with the fallout from aggressive tariff policies and tightening global trade dynamics.
Trump Urges Fed Action as Trade Fears Persist
In response to the disappointing jobs figures, President Donald Trump once again pressed Federal Reserve Chair Jerome Powell to begin cutting interest rates. Trump has been vocal in blaming the Fed for acting too cautiously amid signs of economic slowing, while also intensifying pressure on global trading partners by doubling down on tariffs.
At the same time, trade tensions between the U.S. and China remain high. Speaking late Tuesday, Trump described Chinese President Xi Jinping as “tough” and “extremely hard to make a deal with,” signaling continued uncertainty over any meaningful resolution.
This backdrop has supported gold’s appeal as a store of value, particularly as traditional equity markets remain sensitive to trade headlines and policy shifts.
Eyes on Friday’s Non-Farm Payrolls Report
Market participants are now awaiting the release of the U.S. Non-Farm Payrolls (NFP) report on Friday for additional clues on the Fed’s policy direction. Economists warn that another weak reading could reinforce bets for interest rate cuts later this year.
“If the data is stronger than expected, interest rate cut expectations are likely to wane, which would weigh on the gold price,” said Carsten Fritsch, an analyst at Commerzbank, in a note quoted by Reuters.
He added that in the near term, gold is likely to “trade in a range between $3,300 and $3,400 per troy ounce” given the prevailing market uncertainty.
Gold’s Bullish Momentum Holds in 2025
Gold prices have surged around 28% year-to-date, placing the yellow metal within $150 of its all-time high reached in April. The metal’s resilience continues to be underpinned by a complex web of macroeconomic factors, including geopolitical tensions, rising budget deficits, and diverging central bank policies.
As investors look to hedge against volatility in risk assets, particularly those exposed to tariffs or currency fluctuations, gold remains a favored choice—especially in an environment of falling bond yields and a weaker U.S. dollar.
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