Gold prices steady, holding sharp gains in wake of soft U.S. jobs data

Investing.com-- Gold prices traded in a steady fashion Monday, stabilizing after a sharp rise in the previous session, buoyed by expectations for Federal Reserve interest rate cuts following weak U.S. labor data.

At 05:00 ET (09:00 GMT), Spot Gold slipped 0.1% to $3,358.72 an ounce, while Gold Futures for December gained 0.4% to $3,412.55/oz.

Gold prices rallied after soft US jobs data

Gold prices jumped over 2% on Friday, resulting in the metal posting a weekly gain after two straight weeks of declines.

Data on Friday showed that U.S. nonfarm payrolls rose by just 73,000 in July, well below forecasts, accompanied by downward revisions to May and June figures. 

The unemployment rate ticked up to 4.2%, reinforcing fears of a slowing labor market.

This resulted in the probability of a September rate cut rising substantially, and is now priced at around 90% by markets. 

Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, making bullion more attractive to investors.

Trump tariff jitters support gold’s haven appeal

Investors have also been seeking safe-haven assets as President Trump pressed ahead with sweeping tariffs on imports from countries including Canada, Brazil, India, and Taiwan.

These tariffs have raised inflation concerns and could potentially disrupt global trade flows, further supporting bullion demand.

Gold’s appeal remains strong in a low-yield, uncertain policy environment.

U.S. copper under pressure

Platinum Futures ticked up 1% to $1,329.50/oz, while Silver Futures rose 1.3% to $37.417 per ounce.

Benchmark Copper Futures on the London Metal Exchange gained 0.9% to $9,726.10 a ton, while U.S. Copper Futures rose 0.8% to $4.4695 a pound.

U.S. copper prices plunged 20% last week after President Trump excluded refined metal from his planned 50% import tariff on the metal.

“The collapse of an arbitrage trade has left the U.S. with a huge buildup of copper stockpiles,” ING analysts said in a note.

“Copper inventories at Comex warehouses are at their highest in 21 years. That stockpile might now be re-exported.”

“This will be bearish for LME prices with more copper showing up in LME warehouses,” they added.

Ayushman Ojha contributed to this article