Gold hits highest level since May as US jobs data cools

Gold hits highest level since May as US jobs data cools

Gold hit a six-week high after US hiring data pointed to a gradual cooling of the labor market, which reinforced expectations of lower interest rates in the coming months.

Bullion rose 1.4% to $2,389.35 an ounce as of 1:30 p.m. Friday in New York, gaining after data from the U.S. Bureau of Labor Statistics. which showed that US hiring and wage growth slowed in June, while the unemployment rate rose.

The new figures “keep alive the prospect of a rate cut in September,” said Ole Hansen, head of commodity strategy at Saxo Bank A/S. Swap traders now price in a 75% chance of a rate cut within two months.

“After last week’s strong rally, The increases could be limited by the absence of many operators” in the U.S. after the holiday on Thursday, Hansen said.

Gold held in a relatively narrow fluctuation band for most of the past month, but this week it rose by 2.7% amid expectations of a rate cut in September.

Silver gained 3.3%, while platinum and palladium also rose. The Bloomberg Spot Dollar Index and 10-year Treasury yields were headed for weekly declines.