Gold Prices Soar on Weaker US Jobs Data

Gold prices surged this week as weaker-than-expected US jobs data reduced hopes of a US Fed rate hike, while geopolitical developments in the Middle East added to market uncertainty.

The precious metal posted strong gains after Friday's employment report showed the economy unexpectedly lost 23,000 jobs in July, compared with expectations for an increase of about 80,000. The weak report followed softer-than-expected ADP private payrolls data and a contraction in the ISM Services Employment Index.

Anuj Gupta, a SEBI-registered market expert, said that 'cooling crude oil prices are putting pressure on the US treasury yields and the US Dollar.' He added that 'a smooth supply of crude oil prices is expected to contain inflation, and hence the US Fed rate hike looks unlikely in such a scenario.'

Ponmudi R of Enrich Money said that gold prices are likely to remain highly sensitive to US inflation data, Federal Reserve communication, Treasury yields, the US dollar, and developments surrounding the Strait of Hormuz.