Gold (GC=F) futures began trading at $4,239.50 per troy ounce on Friday, a 0.1% decrease from the $4,243 closing price on Thursday.
Following the opening, the price of gold surpassed $4,250. In order to assess the possibility of a third and final interest rate cut in 2025, traders are mostly focused on economic data this week.
Thus far, the data has been inconsistent. The Challenger, Gray & Christmas survey anticipated 71,321 layoffs last month, which is 24% more than November 2024, after the ADP National Employment survey revealed a loss of 32,000 private-sector employment in November.
Nonetheless, the week of November 29 saw 191,000 new unemployment claims, which is the lowest number in almost three years.
The September PCE inflation report, which is due later today, will be the next hint. Price increases of 2.9% over the previous year are anticipated by analysts.
A higher increase might make it more difficult for the Fed to use lower interest rates to create jobs. When interest rates are declining and the future of the economy is uncertain, gold prices usually increase.
Investing in gold can give your portfolio stability and inflation protection. However, when stock prices are growing rapidly, it can also diminish your gains.
It might be difficult to strike the correct balance between taking advantage of growth possibilities in other assets and the diversification benefits of gold.
There is disagreement among experts on how to strike the right balance. The suggested gold allocations, which range from 0% to 20%, are explained by five experts below.
Professor Robert R. Johnson of Creighton University's Heider College of Business is against gold investing. According to him, "while having a small position in precious metals may dampen portfolio volatility in the short run, the trade-off between the lost long-term return and the slightly dampened volatility is certainly not a prudent one, particularly for Gen Z/millennials with long investing time horizons."
