​EBC Markets Briefing | Gold whipsaws; UK stocks cheered weak CPI

Bullion was unchanged on Thursday after jobs report showed the unemployment rate rose last month from September, reinforcing bets of rate cuts by the Fed and reining in Treasury yields.

Gold has made its biggest jump since the 1979 oil crisis in 2025, a performance which might previously fan fears of a big correction. Yet analysts remain largely bullish on the metal.

Morgan Stanley forecasts gold at $4,500 by mid-2026, while JP Morgan expects average prices at above $4,600 in Q2 and more than $5,000 in Q4. Macquarie sees average prices at $4,225 in 2026.

Central bank diversification of reserves from dollar-denominated assets should give a foundation for gold in 2026 as they buy when investor positioning is stretched, money rotates and prices fall, analysts said.

Part of this year's gold buying was essentially a hedge against potential sharp corrections in equity markets, though a collapse often forces the sale of safe-haven assets.

Net inflows into gold ETFs fell sharply in November, nearly halving on a month-on-month basis, even as gold prices remained elevated after a strong rally this year. That marks the second consecutive month of lower inflows.

The yellow metal looked overbought as per RSI, and the resistance around $4,350 was still intact. As such we expect it to fall towards $4,310 in the short term.

Asset recap

As of market close on 17 December, among EBC products, United States Natural Gas Fund ETF led gains. US gas prices rebounded from 7-week lows as LNG export floes strengthened.

Tech stocks remained on the back foot, with Tesla suffering great losses. California is threatening to ban sales of Tesla cars in the state for 30 days after a regulator said the term "Autopilot" constitutes false advertising.

The FTSE 100 surged as UK inflation slowed more than expected last month amid easing food prices. The surprise decline increased odds of more rate cuts in 2026, which could help counterbalance fiscal tightening.

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