Nov 08, 2022
VOT Research Desk
Following the release of US labor market statistics on Friday, the price of gold increased to $1,680.
The yellow metal rises in value as noted by Commerzbank analysts, but ETF outflows continue to drag down prices. At the close of trade for the week, gold had increased by 2.2%. The weakening of the USD helped the upswing.
Given the repeated rapid increase in US employment in October and the significant upward revision to the prior month’s total, this is noteworthy.
It appears that market investors were more focused on the US unemployment rate’s sharper increase than anticipated. Speculative short positions were likely covered, which is what caused the most recent increase in the price of gold.
According to the CFTC, they were close to 40,000 contracts just a few days ago, which put them barely below their late-September peak.
In contrast, gold ETFs had large outflows towards the conclusion of the previous week, which accelerated following the Fed meeting.
Thus, one crucial foundational basis for the increase in the price of gold is missing.
