Gold Prices Aim to Reclaim $4,450 as USD Weakness Boosts Recovery
Gold prices are on the rise, with the metal aiming to reclaim $4,450 as it recovers from four-week troughs below $4,300. The rebound is driven by renewed US Dollar weakness, falling US Treasury bond yields, and a better market mood.
The Greenback sees fresh selling pressure after Wednesday's weak ADP Employment Change report, which missed forecasts for 48,000 jobs growth. As a result, markets have scaled back expectations for a US Federal Reserve interest rate hike in September to about 62% from 66% seen pre-ADP.
The continued USD/JPY sell-off, amid speculation surrounding intervention by Japanese authorities, adds to the USD's downside bias, bolstering Gold's recovery. Meanwhile, markets are looking past ongoing hostilities in the Middle East as Oil prices stall their rally to six-week highs.
Gold traders will take cues from US ISM Services PMI data and speeches from Fed officials for fresh trading incentives, but Friday's Nonfarm Payrolls (NFP) data from the US could determine whether Gold will sustain its recovery or prepare for a fresh sell-off. The headline NFP is expected to rebound by 58K in August following an unexpected decline of 23K in July.