Gold quietly gathers strength, ahead of NFP!
World gold prices remained stable on Thursday (3/7), ahead of the release of important employment data from the United States (US) which could determine the direction of the Federal Reserve's interest rate policy. Investors are still waiting and seeing the June Nonfarm Payrolls (NFP) report, which is expected to add only 106,000 jobs, the lowest in the last four months. The spot gold price is in the range of $3,353 per ounce, after previously rising more than 2% since the beginning of the week.
When is the crucial moment? NFP data is scheduled for release Thursday evening Indonesian time, and is an important reference for the Fed in determining whether to cut interest rates in the near future. The ADP Employment report released the day before showed that the US private sector actually lost 33,000 jobs, the first decline in the last two years. This has prompted speculation that the Fed could take monetary easing steps sooner than expected.
Why can gold rise? Gold tends to strengthen when interest rate expectations decline because this metal does not produce interest and becomes more attractive as a savings asset. In addition, gold demand has increased amid geopolitical tensions and concerns about the US fiscal deficit. President Trump's massive tax and spending bill is expected to add $3.4 trillion to the national debt over 10 years, strengthening gold's appeal as a safe haven.
How has the market responded so far? Apart from gold, silver prices rose more than 1%, while palladium and platinum weakened. On the other hand, the Bloomberg Dollar Index has been relatively stable as market participants remain on the sidelines ahead of big data. Investors are also watching the US-Vietnam trade deal, as well as the US tariff deadline on July 9, which could trigger further market dynamics.
Source: (ayu-newsmaker)
