Gold climbed to its highest level since December 12, reaching $2,716.91 per ounce, driven by a mix of economic and geopolitical factors.
The rally followed a drop in Treasury yields after U.S. jobless claims unexpectedly rose to 217,000, above the forecasted 210,000. Signs of a softer labor market, together with December’s modest 0.2% rise in core inflation, have pushed investors to price in a greater likelihood of Federal Reserve rate cuts in 2025.
That shift in expectations reduced the appeal of higher-yielding assets and increased demand for gold, which typically benefits when real yields fall. At the same time, escalating tensions in Gaza sustained safe-haven demand, reinforcing gold’s traditional role as a hedge against geopolitical uncertainty.
The combination of weaker economic data and persistent global risks created an environment supportive of higher bullion prices, as market participants reassessed both monetary policy prospects and downside risks to growth.
