Gold price slows the post NFP retracement decline near the all-time high.
The gold price (XAUUSD) ticked higher during the Asian session on Monday, but it lacks bullish confidence and is now trading just below the $2,500 psychological level.
Reduced bets for the Fed’s greater rate decrease support the USD and act as a headwind.
The mixed US jobs report reduced the chances of the Federal Reserve (Fed) cutting interest rates by another 50 basis points. This results in a minor recovery in US Treasury bond yields, which helps the US Dollar (USD) build on Friday’s rebounded from a one-week low, acting as a headwind for the non-yielding yellow metal.
Worries about the US economy’s decline and international tensions provide some assistance.
Meanwhile, the relatively lackluster US job figures sparked concerns about a slowdown in the world’s largest economy. This, combined with the lack of movement in peace negotiations between Israel and Hamas, dampens investors’ demand for risky assets, resulting in some support for the safe-haven gold price. Furthermore, the recent range-bound price action calls for prudence from aggressive traders before preparing for a firm near-term trend.
Daily Market Movers: Gold price receives haven flows with sofer risk tone, increase in US government yields, and USD limit increases.
The US Bureau of Labor Statistics (BLS) stated on Friday that nonfarm payrolls (NFP) In August, the number increased by 142,000, compared to the predicted 160,000 and the previous month’s downwardly corrected 89,000 reading.
Other features of the study revealed that the unemployment rate fell to 4.2% from 4.3% in July, while wage inflation, as measured by the change in Average Hourly Earnings, increased to 3.8% from 3.6% previously.
According to the CME Group’s FedWatch tool, markets are pricing in a 70% possibility of the Federal Reserve cutting rates by 25 basis points later this month, with a 30% chance of a 50-basis-point reduction.
The US Dollar, which originally dipped after the announcement of the jobs data, soon gained ground and traded slightly higher throughout the Asian session on Monday, which, in turn, is expected to providing a tailwind for gold prices.
Meanwhile, mixed US jobs statistics showed obvious indications of a severe downturn in the labor market, weighing on investor sentiment amid continuous geopolitical concerns and supporting the safe-haven XAUUSD.
People’s Bank of China (PBOC) said on Sunday that the country’s gold holdings stood at 72.8 million fine troy ounces.
The People’s Bank of China (PBOC) said on Sunday that the country’s gold holdings stood at 72.8 million fine troy ounces at the end of August, remaining constant for the fourth consecutive month.
Meanwhile, markets responded little to the most recent Chinese inflation data, which showed that consumer prices rose for the seventh straight month in August, while producer price deflation maintained.
