Gold prices rose $5, nearing weekly gains, trading at $1,927.01 an ounce as of 10:19 AM GMT,up 0.53%. Concurrently, the dollar index decreased 0.26% too 98.09 points.
These movements occur amid anticipation of upcoming U.S. non-farm payroll data and speculation surrounding potential Federal Reserve interest rate adjustments. Gold typically performs well in low-interest-rate environments. Investors are currently pricing in a near 100% probability of a 25 basis point rate cut at the September 17 monetary policy meeting, according to the Fedwatch tool.
“Gold prices are gradually increasing today, as traders do not want to try to pay the price too much until we see non-agricultural job data,” saeid Tim Waterer. He added that market dynamics favor gold due to the possibility of lowered interest rates, attempts to influence the Federal Reserve, and the ongoing Russia-Ukraine conflict.
Recent economic indicators, including a higher-than-expected rise in new unemployment claims and a slower-than-forecast increase in private sector jobs in August, are reinforcing expectations of potential rate cuts.Federal Reserve Governor Christopher Waller indicated he believes the U.S. Central Bank should consider reducing interest rates at its next meeting.
The focus now shifts to the non-farm payroll data release at 12:30 GMT, which is expected to provide further insight into the Federal Reserve’s future monetary policy decisions.
