'Al-Sobah': Gold Ends Week at $4,142 per Ounce
Gold prices ended last week’s trading at $4,142 per ounce, marking a second consecutive weekly decline, as rising yields on U.S. Treasury bonds limited the precious metal’s ability to benefit from weak U.S. labor market data.
In a report issued yesterday, Sunday, Dar Al-Sabaik (Kuwait Bullion Company) stated that gold experienced volatile trading last week after attempting to reclaim the $4,200 per ounce level, but failed to break through and sustain above it, before retreating at the week’s end amid rising U.S. bond yields.
The company noted that gold’s movements occurred despite the release of weaker-than-expected U.S. jobs data. The non-farm payrolls report showed the U.S. economy added only 29,000 jobs in September, compared to expectations of around 90,000, while the unemployment rate rose to 4.2% from 4.1%.
Dar Al-Sabaik pointed out that the weak labor market data bolstered expectations regarding the trajectory of U.S. monetary policy. However, the persistence of high Treasury yields acted as a pressure factor on gold, given the rising opportunity cost of holding a non-yielding asset.
The Federal Reserve raised interest rates by 25 basis points in September to a range of 3.75% to 4%, while markets continue to monitor new economic data to assess the path of monetary policy.
The company explained that the U.S. dollar is also a key factor influencing gold’s movement, as its appreciation increases the cost of the metal for holders of other currencies, potentially limiting demand.
The report highlighted the importance of monitoring oil prices and their implications for central bank decisions, noting that rising energy prices could increase inflationary pressures and affect interest rate expectations, which in turn would influence the path of monetary policy and gold demand.
Geopolitical developments in the Middle East remain a key factor influencing the precious metal’s movement, as investors continue to turn to gold as a hedging tool during periods of heightened uncertainty.
Markets are anticipating a range of economic data and events this week, including services sector indicators, the minutes of the Federal Open Market Committee meeting, and statements by Federal Reserve officials, alongside other economic data, to determine the extent to which labor market developments will impact the U.S. monetary policy path.
Dar Al-Sabaik stated that the $4,200 per ounce level remains a significant barrier for gold, after the metal failed to surpass it during last week’s trading. If gold manages to break through and sustain above this level, attention may shift to higher levels, while support levels are seen at $4,100 and then $4,000, which represents a psychological and technical barrier.
The report emphasized that movements in the U.S. dollar and Treasury yields will remain among the most prominent factors influencing gold’s direction in the coming period, alongside energy prices and geopolitical developments.
On the local level, the report noted that the price of 24-karat gold per gram reached approximately 46 Kuwaiti dinars, equivalent to about $134, while 22-karat gold per gram recorded around 38 Kuwaiti dinars, or approximately $123. Meanwhile, the price of a kilogram of silver reached about 657 Kuwaiti dinars, equivalent to roughly $2,133.
