Gold Hits Fresh Record High As Key US Jobs Data Weakens

Gold rallied to a fresh record as an unexpectedly weak US employment report bolstered wagers that the Federal Reserve will cut interest rates later this month.  

Bullion rallied more than 1% to hit a fresh all-time high of $3,586.82 an ounce, extending a steep rally this week as bets on rate cuts have intensified. The move came as a pivotal US payrolls report on Friday showed a slowdown in hiring, while unemployment rose to the highest level since 2021.

Lower borrowing costs tend to boost the appeal of non-yielding gold, which has also seen support from strong haven demand amid concerns over the US central bank’s future. 

Both gold and silver have more than doubled over the past three years, with mounting risks in geopolitics, the economy and global trade driving haven demand. An escalation in President Donald Trump’s attacks against the Fed this year has increased worries over its independence, as he has vowed to gain a “majority, very shortly” on the central bank and bring down rates.

Investors are also still waiting for a landmark ruling on whether Trump has legitimate grounds to remove Fed Governor Lisa Cook, which could allow the president to replace her with a dovish-leaning official. On that, Goldman Sachs Group Inc. analysts wrote in a note this week that gold could rally to almost $5,000 an ounce if the Fed’s independence were damaged and investors shifted just a small portion of holdings from Treasuries into bullion.

Spot gold was up almost 1% at $3,580.06 an ounce as of 1:57 p.m. in London, putting it on track for a 3.8% gain this week, the most since mid-June. The Bloomberg Dollar Spot Index slumped 0.6%, while yields on Treasuries jumped.