Gold Rallies as Weaker US Jobs Data Boosts Bullion

The gold price rose by 0.9% to $4216 per ounce after weaker-than-expected US jobs data was released, reducing its weekly decline to 1.1%. The yellow metal fell 8.5% in September as the Dollar rallied and crude oil prices rose.

Despite long-term US interest rates remaining near multi-decade highs amid concerns over elevated government debt levels, gold has continued to trade at historically high levels, supported by resilient investment demand. This includes continued inflows into gold-backed ETFs, such as SPDR Gold Shares (NYSEArca: GLD) and iShares Gold Trust (NYSEArca: IAU), which increased for the first time in the same month since February.

Nicky Shiels, Head of Research & Metals Strategy at MKS PAMP SA, said that 'with the blowout in US yields and the US$, a regression model says gold should be much lower,' adding that its actual 'debasement premium' is around $840/oz.