Gold Hits Highest Since May After Cooling US Employment Data
Gold headed for a back-to-back weekly gain on expectations that the Federal Reserve will trim interest rates before year-end, with traders looking ahead to US payrolls data for the next batch of clues on the outlook.
(Bloomberg) -- Gold jumped to a six-week high after US hiring data pointed to a gradual cooling in the labor market that bolstered expectations for lower interest rates in the coming months.
Bullion was up 1.4% to $2,389.35 an ounce as of 1:30 p.m. in New York on Friday, climbing on data from the US Bureau of Labor Statistics that showed US hiring and wage growth stepped down in June while the jobless rate edged up.
The new figures “keep the prospect for a September rate cut alive,” said Ole Hansen, head of commodities strategy at Saxo Bank A/S. Swaps traders are now pricing in a 75% chance of a rate cut in two months.
“Having rallied strongly this past week, further upside could be limited with the absence of many traders” in the US following Thursday’s public holiday, Hansen said.
Gold drifted in a relatively narrow trading range for most of the past month, but has jumped 2.7% this week as expectations build for a September rate cut.
Silver advanced 3.3%, while platinum and palladium also gained. The Bloomberg Dollar Spot Index and 10-year US Treasury yields were both on course for weekly declines.
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