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Gold rises as weaker US jobs data cuts October Fed hike odds
Spot gold was up 0.4% to $4,158.17 per ounce, while CME FedWatch pricing put a 22% chance of an October hike, down from 64% a week earlier.
Gold edged higher on Monday as softer US economic data reduced expectations for a Federal Reserve rate hike in October, boosting demand for the non-yielding metal, according to Reuters via LiveMint Markets. Spot gold rose 0.4% to $4,158.17 per ounce by 0150 GMT, while US gold futures for December delivery gained 0.6% to $4,186.40.
The move followed data showing US job growth slowed more than expected in September, and nonfarm payrolls for the prior two months were revised sharply lower, Reuters reported. Tim Waterer, chief market analyst at KCM Trade, said the weaker labor market data has helped dial back October Fed hike expectations, providing support for gold.
Still, Waterer added that the market is treating the Fed’s broader hiking cycle as intact even if a pause occurs in October. Traders now see a 22% probability of an October rate hike, down from 64% a week ago, while the chance of an increase in December remains priced at 87%, according to the CME FedWatch Tool.
The Fed last month raised its benchmark overnight interest rate by 25 basis points to a 3.75% to 4.00% range, its first increase in three years, Reuters noted. The report also referenced geopolitical developments in Yemen as part of the broader backdrop, though details were cut off in the provided text.
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