Online ReporterGold traded near Friday’s record high, bolstered by an unexpectedly weak US employment report that saw wagers increase on the Federal Reserve cutting interest rates. Bullion was almost US$20 short of its latest peak near US$3 600 an ounce, after rallying as much as 1,5 percent late Friday.
A pivotal US payrolls report showed a slowdown in hiring, while unemployment rose to the highest level since 2021.
That saw swaps traders boost bets on interest rate cuts, and they are now pricing almost three reductions for the rest of this year.
Lower borrowing costs tend to increase the appeal of non-yielding gold, which has also seen support from strong haven demand amid concerns over the US central bank’s future.
Looking ahead, renewed rate cut hopes will face tests this week from a benchmark revisions for US jobs data on Tuesday and US producer and consumer inflation prints on Wednesday and Thursday.
Traders will also watch how the market absorbs auctions of 3-, 10-, and 30-year Treasuries. Both gold and silver have more than doubled over the past three years, with mounting risks in geopolitics, the economy and global trade driving haven demand.
An escalation in President Donald Trump’s attacks against the Fed has increased worries over its independence.
He has vowed to gain a “majority, very shortly” on the central bank and bring down rates.
Investors are waiting for a landmark ruling on whether Trump has legitimate grounds to remove Fed Governor Lisa Cook, which could allow the president to replace her with a dovish-leaning official. Goldman Sachs Group Inc. said last week that gold could rally to almost US$5 000 an ounce if the Fed’s independence were damaged and investors shifted just a small portion of holdings from Treasuries into bullion.
Trump’s administration also moved on Friday to exempt gold bullion, along with some metals, from his country-based tariffs. — Bloomberg
