Gold Rates Shows Major Volatility After US Non-farm Data Was Published

Gold rates in the global markets are dependent on multiple factors like inflation, interest rates, stocks market volatility, economic growth, etc. At present gold is not reacting much bullishly, although two weeks ago, the rates were gaining fast. Today, the US has published the country's non-farm payroll data that again pushed the gold prices down internationally.

The non-farm payrolls have increased by 210,000 in November, following a gain of 546,000 in October, according to the US government. However, this data is quite below Wall Street's expectations of 573,000. The country's unemployment rate fell to 4.2%, a 0.4% percentage point decline was followed by a rising labor force participation.

A fall in the unemployment rate eventually indicates that the economic activities are improving. With a better economic ecosystem, investors would be interested in the stock markets and government bonds to buy. Hence, gold rates, have fallen below the $1769/oz range.

Gold rates are very volatile in the present market, because on one side, investors are worried about the high inflationary pressure, as a hedge against inflation, gold rates started to jump up two-three weeks ago. On the other hand, US Fed Chair Jerome Powell's hawkish statement to control inflation and the employment data is creating a bearish trend for gold. Powell and Fed were indicating that they might accelerate the tapering pace in December.

However, the international gold market, losing altitude for a while, started to gain marginally at the end, as the US stock market was selling off and the US bond yields declined. Gold in the Comex closed at $1782/oz, the previous day, it was last traded at $1760.7/oz.

(Also read: Gold Rates Under Pressure, Although Inflation Tends To Rise: What Is The Trend Now?)

Hence, Indian gold rates are also declining this month, in line with the global trends. 22 carat gold rates are now quoted at around Rs. 46440/10 grams, and 24 carat gold rates are quoted at around Rs. 47440/10 grams. In the last 6 days, gold rates in the Indian markets have fallen consistently. This wedding season, falling gold rates will help the gold demand to increase.