FX.co ★ Weak labor market data drives gold prices up

The US labor market continues to shrink as more workers file for first-time unemployment claims.

The US Department of Labor said on Thursday that weekly jobless claims fell by 3,000 to 229,000, down from the previous week's revised estimate of 232,000 claims.

The data fell short of expectations as economists projected claims to fall around 215,000.

Unsurprisingly, there is now a new buying pressure in the gold market, prompting August gold futures to trade at $1,849 an ounce, up 0.61% from the previous day. This makes the medium-term trend to be relevant still.

Continuing jobless claims, which represent the number of people already receiving benefits, were at 1.312 million. This is 3,000 more than the previous week's revised level.

Demand for safe-haven assets is driven by market concerns that arose when major central banks, including the Federal Reserve, increased interest rates this week.

The sharp sell-off of USD also benefited gold.