Gold Heads for First Weekly Gain in a Month
Spot gold prices rose 1.4% on Friday (July 3rd) and are on track for their first weekly gain in five weeks. This strengthening occurred after investors began trimming expectations for a Federal Reserve interest rate hike following weaker-than-expected US employment data.
At 4:30 a.m. Eastern Time, spot gold was trading at around US$4,182.28 per ounce, potentially recording a 2.3% weekly gain. If realized, this would be the first weekly gain since late May. Meanwhile, the near-month US gold futures contract rose 1.5% intraday.
Despite strengthening this week, gold prices have remained under pressure throughout the year. Concerns about inflation, a strengthening US dollar, and hawkish central bank sentiment following the previous US-Iran war have dampened investor interest in the precious metal.
Gold also recorded its worst quarterly performance in 13 years in the three months to June. Currently, gold prices are still trading around 22% below their all-time high of over US$5,300 per ounce reached in January.
This week's gold rebound was fueled by US Nonfarm Payrolls data, which showed the economy added only 57,000 jobs in June. This figure is lower than the downwardly revised 129,000 jobs in May and also below the Dow Jones consensus of 115,000.
The market now rates a 53.5% chance of a Fed rate hike of at least 25 basis points in September, down from around 65% before the release of the jobs data. In other metals markets, spot silver jumped 2.9% to US$62.77 per ounce and is on track for a weekly gain of around 6.7%, while the August silver contract rose 3.5%.
Source: Newsmaker.id
