Gold Reaches $4,360 as Weak Jobs Data Boosts Bull Case
Gold prices have rebounded from the critical $4,000 support zone and are now trading above $4,360. The precious metal's price surge can be attributed to a weaker U.S. dollar and softer American employment data, which has strengthened expectations for a less aggressive Federal Reserve.
The disappointing jobs report showed payrolls falling by 23,000 in July, compared with expectations for an increase of around 80,000. This shift in interest-rate narrative has provided a significant boost to gold prices, which gained nearly 10% during the week.
The latest rally is looking more significant than a simple short-term bounce as gold has now moved decisively away from the $4,000 support region and is attempting to establish a new bullish trend. However, the next major inflation report on Wednesday could quickly change this narrative, with higher-than-expected inflation creating a problem for the gold rally by encouraging the Fed to maintain a more restrictive stance.