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Unemployment rates are creeping up – and the bulls are waiting in the wings

The number of American workers filing claims for unemployment has leaped skywards, irrespective of the positive GDP data. The latest figures, issued yesterday (Thursday) by the U.S. Labor Department add further credence to the idea of spring rate cuts – and therefore further strengthen the gold bulls, adding to the yellow metal’s upwards trajectory for 2024.

The new figures confirm a 25,000-person increase in new unemployment claims being filed for the week ending 20 January. This took the total to 214,000 new claims, up from the previous week’s 187,000 claims.

Significantly, this figure was much higher than analysts had expected. It had been thought that new unemployment claims would drift only very slightly higher, with economists expecting to see around 199,000 new claims made for the third week of the year.

The number of people continuing to claim unemployment benefits for consecutive weeks also increased. That figure rose by a further 27,000 people to 1.833 million.

The unexpected rise to the upside is great news for the bulls as it adds further support to the yellow metal. In addition to providing more fuel for the Federal Reserve to cut rates – it has previously said that unemployment figures would be a key factor – the spike also suggests volatility in the economy is ticking up. In periods of volatility and uncertainty, gold’s safe haven status automatically attracts attention – something which should push the precious metal upwards through the price charts.

Federal Reserve officials are expected to meet next week to determine what changes if any they’ll make in February. Meanwhile, gold prices continue to be both strong and steady, trading around the £1,585 ($2,033) marker.

If you’re ready to add gold to your portfolio, the time to act is right now. Don’t delay and wait for prices to increase. Buy now.

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