Gold prices shot up Thursday on weaker-than-expected U.S. jobless claims data and a key court ruling that struck down most of former President Donald Trump's proposed tariffs. These events have driven an increase in investor demand for gold as a safe-haven asset.
Spot gold gained 0.9% to $3,319.22 an ounce by 09:37 ET (13:37 GMT), bouncing from session lows. Gold futures in the United States were flat at $3,294.60.
The U.S. Labor Department said in its weekly report that initial jobless claims rose by 14,000 to a seasonally adjusted 240,000 for the week ending May 24, topping economists' forecast of 230,000. The increase indicates a potential weakening in the labor market — a factor that may impact the monetary policy plans of the Federal Reserve.
"Gold is rallying on a jump in weekly initial jobless claims, which may be an early sign of a softening labor market and the market starting to price in rate cuts more rapidly by the Federal Reserve," said Tai Wong, an independent metals trader.
In a parallel ruling, the U.S. Court of International Trade decided that former President Donald J. Trump had overstepped his authority when he imposed widespread tariffs under the International Emergency Economic Powers Act of 1977. However, the tariffs on auto, steel, and aluminum imports—based on Section 232 of the Trade Expansion Act of 1962—remain in place.
The Trump administration said it would appeal the decision, and the case could eventually reach the Supreme Court. Analysts said while the ruling introduced new uncertainty, it wasn't fundamentally likely to change the overall trading relationship with the important partners.
Investors are also looking forward to the U.S. Personal Consumption Expenditures (PCE) data, due Friday, that might offer more clues about which way inflation trends are headed and what it might mean for the Federal Reserve policy.
Other precious metals also gained: silver added 0.9% to trade at $33.28 an ounce, platinum climbed 1% to $1,085.59, and palladium gained 0.6% to $968.43.
