Gold Prices Rebound as Fed Rate Hike Expectations Weaken

Gold prices have rebounded in August as investors anticipate a rate freeze by the U.S. Federal Reserve, according to InvestingCom data.

The price of gold futures for December delivery closed at $4465.42 on the New York Mercantile Exchange, up 0.55% from the previous session and an 11.35% increase from $4005 on July 13th last month.

This rebound comes as expectations for a rate hike have weakened due to slower-than-expected U.S. employment indicators released in early August. The number of nonfarm workers fell by 23,000 last month, far below the market consensus of 80,000.

Additionally, inflation has slowed, with the U.S. Consumer Price Index (CPI) rising 3.4% in July from a year earlier. This development supports the possibility of the Federal Reserve keeping interest rates unchanged for now.

The probability of a rate hike in September, reflected in the Chicago Mercantile Exchange (CME) FedWatch, has fallen from 50% to around 40%.