Gold Stabilizes at $4,475 as Fed Rate Hike Odds Ease
Gold prices steadied around $4,475 an ounce on Friday after rising by about 2% on Thursday. The metal's value is being closely watched ahead of the U.S. jobs report, due at 8:30 a.m. EDT. Investors are weighing how much expectation for fewer rate hikes is already reflected in gold's current price.
Federal Reserve Governor Christopher Waller said recent data pointed to some disinflation and that he would favor keeping the federal-funds target at 3.50% to 3.75%. If inflation comes in hot, however, he would consider a rate hike. Markets have lowered the chance of a September hike to 50% from 63.2%, based on a Reuters survey and CME FedWatch reading.
Waller's signal gave gold 'something of a steroid shot,' according to independent analyst Ross Norman, but cautioned that new data would be more important. The pause overnight suggests the policy shift caused a sharp rise, then consolidation, not another rally.
The Bureau of Labor Statistics will release the August jobs report at 8:30 a.m. EDT. Economists expect payrolls to increase by 56,000 after falling by 23,000 in July, with projections ranging from a loss of 25,000 to a gain of 121,000.