Gold Prices Surge to Record High on US Jobs Data, Expectations of Rate Cut
Gold Prices Reach Record High
Gold prices soared to a new peak on Friday following data showing an increase in the U.S. unemployment rate, sparking speculations that the U.S. Federal Reserve may soon implement interest rate cuts.
Market Performance
Gold surged by 0.5% to $2,170.55 per ounce, while U.S. gold settled 0.9% higher at $2,185.50, marking the most significant weekly percentage increase since mid-October.
Factors Driving Gold Prices
Gold hit an all-time high of $2,185.19 after reports revealed a rise in the U.S. unemployment rate alongside wage gains moderation despite accelerated job growth in February.
David Meger, director of metals trading at High Ridge Futures, noted that expectations of future rate cuts by the Fed and dollar weakness continue to drive the upward trend in gold prices.
Market Trends and Forecasts
The dollar’s slight decline and lower 10-year U.S. Treasury yield have made gold more affordable for international buyers. Traders are now considering a 30% chance of rate cuts in May, with June remaining the most probable scenario at 73%.
Gold as a Safe-Haven Asset
Gold’s recent rally, starting from its peak on Tuesday, has been fueled by cooling price pressures and its safe-haven appeal amid economic uncertainties. Low interest rates further support gold prices by reducing the opportunity cost of holding the precious metal.
Market Benchmark and Metals Performance
London’s gold price benchmark hit a record high of $2171.30 per troy ounce. In contrast, spot silver eased by 0.3% to $24.25, platinum decreased by 0.9% to $910.10 per ounce, and palladium fell by 1.8% to $1,015.50, despite all three metals showing weekly gains.
