Gold prices rise following higher-than-expected US unemployment rate

December 16, 2025 – Gold prices saw a slight increase on Tuesday, December 16, after the US unemployment rate rose unexpectedly in November. The rise in unemployment sparked market speculation that the Federal Reserve (Fed) may reduce interest rates twice in 2026.

According to Reuters, spot gold prices climbed by 0.2%, reaching $4,310.21 per ounce at 1:48 PM ET (18:48 GMT). Meanwhile, US Gold Futures contracts dropped by 0.1% to $4,332.3.

The US dollar weakened to its lowest point in two months, making gold, which is priced in dollars, cheaper for foreign buyers. The yield on US 10-year Treasury bonds also dropped slightly.

"This data gives the Fed more reason to cut interest rates, and if they do, it will be seen as a positive sign for gold… that’s how the market is interpreting it right now," said Bob Haberkorn, senior market strategist at RJO Futures.

Despite the increase in employment in November, the unemployment rate rose to 4.6%, up from September, amid ongoing economic uncertainties due to President Donald Trump's aggressive trade policies. A Reuters survey of economists had predicted an unemployment rate of 4.4%.

Last week, the Federal Open Market Committee (FOMC) announced a 0.25% rate cut, and comments from Chairman Jerome Powell were seen as less hawkish than expected.

US interest rate futures still expect two more 0.25% rate cuts in 2026. Gold, which does not yield interest, tends to perform better in low-interest-rate environments.

Investors are awaiting the November Consumer Price Index (CPI) data, which will be released on Thursday, and the Personal Consumption Expenditures (PCE) price index, to be announced on Friday.

Alex Ebkerian, COO of Allegiance Gold, predicted that if gold prices close above $4,400 by the end of 2025, they could reach $4,859-$5,590 in 2026. He also suggested that silver may test $50 per ounce again next year.

Spot silver prices fell 0.3% to $63.75 per ounce, down from a record high of $64.65 on Friday. Platinum surged by 4% to $1,854.95, marking the highest level since September 2011, while palladium increased by 2.5% to $1,606.41, hitting a two-month high.

"Platinum metals are rising due to tight supply and growing demand," Ebkerian said.

Morning update (December 17, 2025):

Bloomberg reported that gold prices rose by 0.1% to $4,306.05 at 7:23 AM Singapore time, still within $80 of the record high of $4,381.52 in October. Silver prices fell by 0.1% to $63.70, while platinum slipped slightly, and palladium increased. The Bloomberg Dollar Spot Index closed the previous session down by 0.1%.

Gold prices have stabilized as the weak US job data on Tuesday did not significantly affect expectations of further rate cuts. Gold remains near $4,305 per ounce, following a slight dip in the previous session, halting a five-day upward streak. The latest economic data shows a continued slowdown in the US labor market, but the Fed is perceived to be giving less weight to these numbers due to the effects of the government shutdown.