Weak US data lifts gold as traders’ attention turns to US jobs report

Gold prices rose for a fourth straight session on Friday as weak US economic data fanned fears over sluggish growth, with investors awaiting a key jobs report that could cement expectations for further rate cuts by the Federal Reserve.

Spot gold was up 0.3% to $1,508.90/oz as of 3.39am GMT. It climbed to $1,518.50/oz, its highest since September 25, in the previous session.

US gold futures were flat at $1,515.10/oz.

ANZ analyst Daniel Hynes said the disappointing economic indicators from the US in the past couple of days were supporting safe-haven buying.

“If we see weaker than expected nonfarm payroll data as well, that will support gold prices and the momentum will be pretty strong provided it is backed up by Fed’s dovishness,” he added.

US services sector activity slowed to a three-year low in September amid rising concerns about tariffs, a survey showed on Thursday, after a string of poor economic data earlier this week.

Focus now is on a US nonfarm payrolls report due at 12.30am GMT.

Two Fed policymakers on Thursday signalled they are open to delivering another rate cut, while vice-chair Richard Clarida said the central bank “will act as appropriate to sustain a low unemployment rate and solid growth and stable inflation.”

Lower interest rates decrease the opportunity cost of holding non-yielding bullion and weigh on the dollar.

The US dollar was marginally lower against a basket of major currencies.

Meanwhile on the trade front, new 25% US tariffs on Italian cheese, French wine, Scotch whisky and thousands of other European food products will lead to higher prices ahead of the holiday season and cost US jobs, trade groups said on Thursday.

Gold is considered a safe store of value during economic and political uncertainty.

Spot gold may end its bounce around a resistance at $1,514/oz, as suggested by a retracement analysis and a falling channel, according to Reuters analyst Wang Tao.

Among other precious metals, platinum fell 0.6% to $885.13/oz, on track to post its biggest weekly decline since May, having fallen more than 4% so far this week, while silver gained 0.3% to $17.61/oz.

Palladium rose 0.2% to $1,656.20/oz, but is still set to post its first weekly loss after gaining for eight. Prices are down about 1.5% so far this week.

Reuters