Gold Prices Soar to Seven-Week High on Weaker-than-Expected US Jobs Data

Gold prices surged on Friday to hit their highest in seven weeks after an unexpected decline in US nonfarm payrolls for July derailed rate-hike hopes. Spot gold jumped 2.4% to $4,341.69 per ounce by 10:57 a.m. EDT (1457 GMT), with U.S. gold futures climbing 2.4% to $4,402.20.

The weaker-than-expected jobs data has led analysts to believe that the Federal Reserve will be less likely to raise interest rates at its next meeting. This decrease in rate-hike hopes is expected to weaken the US dollar and strengthen gold prices.

David Meger, director of metals trading at High Ridge Futures, stated, “The weaker-than-expected jobs data presents a scenario where the Fed is going to be less likely to raise interest rates at its next meeting.” He added that declining energy prices and the reduced likelihood of US interest rate increases portend a weaker dollar and stronger gold prices.

UBS expects gold prices to reach $5,000 per ounce in the first half of 2027. As interest rates are lowered, gold becomes more attractive relative to yield-bearing assets as it does not generate interest.