Gold holds firm near record highs amid dovish Fed signals, weaker jobs data shifts focus to NFP
Gold (XAU/USD) is taking a breather on Thursday after hitting a fresh record high of $3,578.50 on Wednesday, pausing a remarkable seven-day rally. At the time of writing, XAU/USD is trading around $3,548 during the American session, after slipping toward $3,510 earlier in the day, as profit-taking and a steady US Dollar (USD) weigh on sentiment. The move also comes as calm returns to global bond markets after this week’s turmoil, easing some of the safe-haven rush that had fueled bullion’s record run.
The broader rally in Gold remains intact, underpinned by firm expectations that the Federal Reserve (Fed) will lower interest rates in its September 16-17 monetary policy meeting. Lower borrowing costs reduce the opportunity cost of holding non-yielding bullion, while a broadly weaker US Dollar keeps demand supported. At the same time, calmer bond markets, ongoing global trade tensions, and concerns over fiscal credibility in major economies and the Fed's independence continue to underpin safe-haven demand.
Fresh US labor market data points to mixed signals. The ADP Employment Report showed private payrolls rising by just 54,000 in August, undershooting expectations and marking a sharp slowdown from July’s revised 106,000. Weekly Initial Jobless Claims also edged higher to 237,000, indicating a modest pickup in layoffs. On the brighter side, Q2 Nonfarm Productivity was revised up to 3.3% while Unit Labor Costs eased to 1.0%, suggesting cooling wage pressures. The figures reinforce expectations for a September Fed rate cut, with traders now turning their attention to Friday’s Nonfarm Payrolls (NFP) for confirmation of the labor market trend.
Source : Fxstreet
