Gold prices rose in the European market on Friday, resuming gains that had paused yesterday amid profit-taking and correction moves, approaching once again their all-time highs and heading for a third consecutive weekly gain, supported by strong demand for the metal as the best alternative investment.
A series of weak data on the US labor market boosted expectations that the Federal Reserve will cut interest rates by 25 basis points at the September meeting to near full pricing.
To confirm this pricing, global financial markets await later today the release of the monthly US jobs report, which the Fed relies on heavily in determining the course of US monetary policy.
Price Overview
• Gold prices today: gold rose by 0.45% to $3,561.15, from an opening level of $3,545.88, recording a low at $3,540.22.
• On Thursday, prices fell by 0.4%, the first loss in eight days, amid profit-taking after hitting an all-time high of $3,578.61 per ounce on Wednesday.
Weekly Performance
Over the course of this week—ending officially at today’s settlement—gold prices are up about 3.3%, heading for a third straight weekly gain and the biggest weekly rise since June.
These weekly gains are attributed to strong safe-haven demand amid rising concerns about global debt levels and renewed tensions over Trump’s tariffs.
US Dollar
The dollar index fell by 0.25% on Friday, reflecting the decline of the greenback against a basket of global currencies, which in turn supported higher gold and other dollar-denominated commodities.
US Interest Rates
• On Wednesday and Thursday, the US released a series of economic data showing further weakness in the labor market.
• Following this, CME FedWatch data showed pricing for a 25 basis point Fed rate cut in September jumped from 92% to 99%, while the probability of no change dropped from 8% to 1%.
• October rate-cut probabilities also rose, with a 25 basis point reduction priced at 99%, versus just 1% for no change.
• Several Fed officials reiterated that labor market concerns continue to support the case for rate cuts. Fed Governor Christopher Waller stated he believes the central bank should lower rates at its upcoming meeting.
US Jobs Report
To further confirm the above pricing, markets are awaiting the US monthly jobs report later today, which will include key labor data such as non-farm payroll additions for August, the unemployment rate, and average hourly earnings.
At 12:30 GMT, non-farm payroll data is expected to show the US economy added 75,000 jobs in August, compared to 73,000 in July, with unemployment rising to 4.3% from 4.2%, while average hourly earnings are forecast to hold steady at a 0.3% increase.
Outlook for Gold
• Ole Hansen, Head of Commodity Strategy at Saxo Bank, said the short-term direction for gold depends on US jobs data and its impact on rate-cut expectations, bond yields, and the dollar. He noted that weaker-than-expected jobs figures could push prices toward $3,650, while the $3,450–$3,500 range remains a key support zone.
• Hansen added that the mix of lower funding costs, concerns about Fed independence, geopolitical risks, a steepening yield curve, and a weaker dollar all point toward further gains in precious metals.
SPDR Fund
Holdings of the SPDR Gold Trust, the world’s largest gold-backed ETF, fell yesterday by 2.29 metric tons, marking a second consecutive daily decline, bringing the total down to 981.97 metric tons.
