Gold prices edged lower during Thursday's Asian trade as traders assessed the implications of robust United States labour market data and shifted attention to upcoming inflation figures.
By 4 pm AEDT (5 am GMT), spot gold was down 0.4% at US$5,067.57 per ounce.
Despite the pullback from Wednesday’s eight-day high of $5,119, downside pressure has been tempered by fresh weakness in the U.S. dollar.
The greenback has come under renewed selling interest, partly reflecting continued downside momentum in USD/JPY. The yen has strengthened following Japanese Prime Minister Sanae Takaichi’s decisive victory in snap elections and speculation about potential foreign exchange intervention, weighing on the broader dollar.
This softer tone in the U.S. currency has offset some of the headwinds facing gold after the latest U.S. employment report.
Data released on Wednesday (Thursday AEDT) showed that U.S. nonfarm payrolls increased by 130,000 in January, well above estimates of 70,000. The unemployment rate unexpectedly eased to 4.3% from 4.4% in December 2025.
The stronger-than-expected jobs figures prompted markets to reassess the outlook for U.S. monetary policy.
According to the CME Group FedWatch Tool, traders have largely ruled out the prospect of a March interest rate cut and pared back expectations for a June reduction.
Geopolitical developments have also provided underlying support. Renewed tensions between the U.S. and Iran have kept safe-haven demand in play, offering a cushion for bullion prices.
In the near term, traders are watching the release of U.S. weekly jobless claims data later on Thursday (Friday AEDT) for further clues on labour market conditions.
Attention will then turn to Friday’s U.S. consumer price index report (Saturday AEDT), which is expected to play a decisive role in shaping expectations for Federal Reserve policy.
