Gold Holds Steady as Investors Await Major U.S. Economic Data

Gold prices steadied Wednesday after dropping 1% in the previous session, as investors await key US economic data this week that could signal potential interest rate cuts ahead.

Spot gold held at $2,007.43 per ounce as of 0028 GMT. December gold futures climbed 0.5% to $2,039.50 per ounce, showing some recovery from Tuesday's decline.

Markets are betting heavily on a Federal Reserve rate cut this month. The CME FedWatch tool shows 89% probability that the central bank will lower rates, which typically benefits gold since lower rates reduce the opportunity cost of holding non-yielding assets.

Two major data releases this week could shape Fed policy. Wednesday brings November jobs data, while Friday's personal consumption expenditures index for September will provide fresh inflation insights. Both reports carry significant weight in Fed decision-making.

The jobs report matters because strong employment growth might give the Fed reason to pause on rate cuts. But if hiring slowed more than expected, it could strengthen the case for monetary easing.

President Donald Trump added another element to watch, saying he'll announce his pick for the next Fed chair in early 2026. While that's still over a year away, any hints about his preferred monetary policy direction could move markets.

Other precious metals struggled Wednesday. Silver fell 0.2% to $28.32 per ounce, platinum dropped 0.4% to $931.10, and palladium declined 0.6% to $1,058.83. These metals often follow gold's direction but tend to be more volatile due to their industrial uses.

For traders, the current setup presents a classic wait-and-see moment. Gold's recent pullback from record highs near $2,080 has created some breathing room, but the metal remains sensitive to any shifts in rate expectations. Strong economic data could push gold lower, while weak numbers might send it back toward those highs.