Gold Surges on Weaker-than-Expected US Jobs Data
Gold prices surged to a seven-week high on Friday after an unexpected decline in US nonfarm payrolls for July. The jobs data release dashed rate-hike hopes, and spot gold jumped 2.3% to $4,336.02 per ounce by 2:42 p.m. EDT.
The weaker-than-expected jobs data led economists to predict a reduced likelihood of a US interest rate increase at the next meeting. David Meger, director of metals trading at High Ridge Futures, stated that '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.'
The drop in energy prices and reduced likelihood of a US interest rate increase also contributed to a potential weakening of the dollar. As a result, gold prices are expected to rise. UBS predicts that gold will climb to $5,000 per ounce in the first half of 2027.