Gold prices fell on Thursday after unexpectedly strong U.S. jobs data for January dampened hopes for further interest rate cuts from the Federal Reserve in the near term.
Spot gold was down 0.3% at $5,064.29 an ounce by 1014 GMT. U.S. gold futures for April delivery fell 0.2% to $5,086.50 an ounce.
Spot silver fell 0.7% to $83.47 an ounce after rising 4% on Wednesday.
“Better-than-expected U.S. jobs data dampened expectations that a Fed rate cut was imminent, and gold eased from above $5,100 and silver from above $86, pushing the dollar higher,” said Ole Hansen, head of commodity strategy at Saxo Bank.
“While the focus on newly released economic data suggests some normalization is underway after the recent spike in volatility, the upcoming Chinese New Year holiday could further reduce risk appetite and liquidity,” Hansen added.
Fed policymakers appear likely to keep interest rates on hold for an extended period after Wednesday’s data showed the U.S. job market started 2026 on a stronger-than-expected footing.
U.S. job growth rose by 130,000 in January, dropping the unemployment rate to 4.3%, after a downwardly revised 48,000 increase in December.
Economists polled by Reuters had expected employment to rise by 70,000.
As interest rates fall, the opportunity cost of holding non-yielding gold decreases.
Investors are awaiting the weekly U.S. jobless claims report later in the day and inflation data on Friday for further clues about the Fed’s monetary policy direction.
“I think Friday’s CPI (inflation rate) will be key,” said OANDA Market Pulse analyst Zane Vawda. “A weak CPI result combined with the jobs report could limit further gains in gold and potentially push gold below $5,000 an ounce.”
Spot platinum fell 1.5% to $2,098.94 an ounce, while palladium rose 0.7% to $1,710.26.
