Gold rally gains further momentum after soft US data

Gold extended its record-breaking rally on Wednesday, powered by softer U.S. jobs data that reinforced expectations of a Federal Reserve interest rate cut later this month, while lingering global uncertainties kept safe-haven demand firmly in play.

Spot gold was up 0.9% to $3,562.80 per ounce by 10:46 a.m. EDT (1446 GMT), after hitting a record high of $3,565.57.

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U.S. gold futures gained 1% to $3,627.40.

The U.S. government reported that job openings fell more than expected in July and hiring was moderate, consistent with easing labor market conditions.

Gold was already trading in record territory before the release of the data, and the softer numbers helped keep the precious metal buoyed, with the next upside target eyed at $3,600 an ounce, said Fawad Razaqzada, a market analyst at City Index and FOREX.com.
Following the data, traders boosted the probability that the U.S. central bank would cut rates by 25 basis points at its September 16-17 policy meeting to 98%, up from 92% earlier, according to CME Group’s FedWatch tool.

Investors’ focus now shifts to U.S. jobless claims and ADP employment data on Thursday and the closely-watched monthly nonfarm payrolls report on Friday.

Federal Governor Christopher Waller on Wednesday repeated his call for a rate cut this month, and said that how fast the central bank lowers borrowing costs after that meeting will depend on what happens next in the economy.

Fed Governor Lisa Cook, meanwhile, laid out in greater detail on Tuesday her opposition to President Donald Trump’s bid to remove her from office. Trump has repeatedly criticized Fed Chair Jerome Powell for not cutting rates this year.

“Growing concerns over the independence of the U.S. central bank are further undermining trust in dollar-denominated assets and pushing investors toward gold,” traders at Heraeus Metals said. [USD/]

Trump is set to ask the U.S. Supreme Court to validate the legality of his broad import tariffs after two setbacks in lower courts.

Elsewhere, the euro zone economy kept expanding at a snail’s pace in August.

Bullion tends to gain traction during uncertain times and a low-interest rate backdrop.

“Gold’s rally has room to run, with short to medium-term targets around $3,600 to $3,800, and the breakout pattern suggesting $4,000 could be within reach by late first quarter next year,” said Peter Grant, vice president and senior metals strategist at Zaner Metals.

Riding the wave of gold’s rally, spot silver rose 0.8% to $41.22, its highest level since September 2011.

Platinum gained 2.1% to $1,432.12 and palladium was up 1.6% to $1,152.68.