U.S. employment data strengthens interest rate cut expectations, spot gold breaks $3,600 for the first time

The latest US non-farm payrolls data is likely to set the stage for the Federal Reserve to cut interest rates at its next meeting in two weeks. Gold prices continued to rise, with spot gold standing at $3,600 an ounce. Data released by the US Labor Department on Friday showed that 22,000 jobs were added in August, less than the 75,000 economists had expected. "Gold prices are now finally breaking through the upper end of the trading range that has been in place for months," said Barbara Lambrecht, an analyst at Commerzbank Research Institute. Concerns about the independence of the Federal Reserve and heightened demand for hedging geopolitical risks also contributed to the rally. After rising 27 per cent in 2024, gold has surged more than 37 per cent so far this year, driven by a weaker dollar, central bank purchases, looser monetary policy environment and heightened geopolitical and economic uncertainty. "Gold has hit new highs and bulls are watching the apparent weakness in employment trend translate into multiple rate cuts," said Tai Wong, an independent metals trader. "The outlook for gold is unquestionably bullish in the short and even medium term as labour market concerns trump inflation concerns. But barring a major market dislocation, I think gold is still a long way from $4,000."