[View this email in your browser]( [Youtube]( [Kitco Metals]( Editor's Picks [@neils_C]( The U.S. labor market has defied all expectations in 2024, but sentiment has started to shift as five months of consecutive outperformance come to an end. Heading into the weekend, markets continue to digest the disappointing nonfarm payrolls numbers. [The U.S. economy created 175,000 jobs last month]( according to the Bureau of Labor Statistics. The monthly figure missed expectations as economists were looking for job gains of 238,000. At the same time, the unemployment rate increased, and wages didnât rise as much as expected. This was initially good news for the [gold market]( and prices briefly popped; however, in a fatigued market, many traders used the rally to sell. The gold market has managed to hold support above $2,300 an ounce, but it is ending the week with a roughly 1% loss. After its massive $400+ rally, the gold market continues to consolidate and trend lower as sentiment normalizes. The focus again turns to the Federal Reserveâs monetary policy and interest rates. Ahead of Fridayâs employment number, the Federal Reserve poured cold water on expectations that it would start its easing cycle this summer. [The central bank left interest rates unchanged and noted a lack of progress in bringing inflation down to its 2% target](. The latest employment data will provide the Federal Reserve with a sense that the labor market is cooling, easing inflation pressures, but it wonât prompt them to act anytime soon. This will limit goldâs gains in the near term. However, this consolidation period is not bad; a reset in the market will allow investors to establish tactical positions without having to chase the market. While gold prices have room to fall lower as the Fed maintains its restrictive monetary policy, the market wonât completely collapse. The U.S. central bank may not be dovish, but it certainly isnât hawkish. After the decision, Powell made it very clear multiple times during his press conference that the Federal Reserve is not looking to raise interest rates. "I think it's unlikely that the next policy rate move will be a hike. I'd say it's unlikely," Powell said during his press conference. Analysts note that this puts a cap on bond yields and a floor under gold. At the same time, the factors that drove gold prices to record highs despite the Federal Reserveâs current stance still remain in play. In particular, central banks are expected to maintain their voracious appetite for gold. [The World Gold Council released its first-quarter Gold Demand Trends report and said the central bank bought 290 tonnes of gold in the first three months of the year, the strongest start on record.]( âGold has proven to be a very powerful diversifier, and that is one of the key reasons that central banks themselves cite us as the reason for holding it,â WGC
Director of Global Research Juan Carlos Artigas told Kitco News in an interview. Many major banks have dismissed goldâs current correction and continue to see higher prices this year. Goldman Sachs has dismissed a higher Fed funds rate as they see prices rallying to $2,700 by the end of the year. âWe're seeing a surge in demand from emerging market central banks and from Asian retail investors,â said Nicholas Snowdon, Head of Metals Research at Goldman, in a commentary published ahead of the U.S. central bankâs decision. âWe think these are long-term dynamics that will keep a firm bid under gold. So even if rates do stay high, we expect to see continued bullish momentum in the gold price.â That is it for this week. Have a great weekend. Neils C. Editor's picks [Gold market sees its best start in eight years as Asian retail demand and central bank purchases dominate Q1 - World Gold Council]( market sees its best start in eight years as Asian retail demand and central bank purchases dominate Q1 - World Gold Council]( [Why Is China Top Gold Buyer Right Now? Whatâs Behind the Record Gold-Buying Streak? - Peter Grandich]( Is China Top Gold Buyer Right Now? Whatâs Behind the Record Gold-Buying Streak? - Peter Grandich]( [U.S. Is a âTiger Backed into a Cornerâ as Dollar Loses Hegemony, More Conflicts & Trade Wars Coming](. Is a âTiger Backed into a Cornerâ as Dollar Loses Hegemony, More Conflicts & Trade Wars Coming]( [Fedâs Powell is âextremely scripted,â hereâs the bad & good news from Fed announcement: Irene Tunkel]( Powell is âextremely scripted,â hereâs the bad & good news from Fed announcement: Irene Tunkel]( [Kitco News]( [Gold prices jump higher after U.S. economy created 175K jobs in April, missing expectations]( [Fed Chair Powell maintains hawkish stance, tells reporters âI donât see the stag or the flationâ]( [BlackRockâs Bitcoin ETF records first drawdown as outflows hit record high]( [Record PBoC gold purchases may indicate that China is planning to invade Taiwan â Experts]( [Goldman Sachs says goldâs bullish momentum remains even if the Fed maintains restrictive rates]( [Bank of Korea chooses U.S. dollarâs liquidity over goldâs safety but will buy when needs and prices align]( [MKSâ Nicky Shiels asks if Costco gold is the market's new ETF moment]( [Sucden Financial still sees $3,000 gold as prices test critical support ahead of Q2]( [Wall Street is optimistic about the economy, but LegalShield says Main Street is telling a different story]( [Gold is the cornerstone of stability as government debt rises out of control - abrdnâs Minter]( [Gold is likely the âmissing linkâ in understanding the recent rebalancing of equity market sentiment â Lombard Odier]( [Bitcoin and interest rates: will rate cuts fuel the next bull run?]( [Bitcoin outlook: short-term weakness on the road to global adoption]( [Deutsche Goldmesse]( [Wall Street joins Main Street in the bear cave for next week as goldâs price momentum wanes]( [Gold Live App]( [Kitco Mining]( ['No euphoria' - Kai Hoffmann says generalist investor is still missing from resource stocks]( euphoria' - Kai Hoffmann says generalist investor is still missing from resource stocks]( [Barrick Gold sees slightly slower production as higher gold price drives a 143% increase in Q1 earnings]( [Pan American Silver announces the sale of La Arena for $245 million to Zijin Mining]( [Seeds of destruction - Can mining side step another bubble, wonders Newcore Goldâs Luke Alexander?]( [Kitco Gold Chart]( [Kitco Gold Chart]( Technically Speaking Jim Wyckoff Market Analyst and Columnist
jwyckoff@kitco.com [Gold price rallies after softer U.S. jobs growth in April]( Promotion [Mother's Day gift]( This message was intended for {EMAIL} , as a subscriber and/or customer of Kitco.
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