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Investing.com - Gold prices jumped to a fresh record high on Friday, as a softer-than-expected U.S. jobs report all but cemented expectations for a Federal Reserve interest rate cut later this month.
Spot gold rose 1.0% to $3,581.07 an ounce, while gold futures for December rose 0.9% to $3,637.42/oz by 09:27 ET (13:27 GMT). Spot prices had hit a prior record high of $3,578.80/oz earlier this week.
Bullion, along with broader metal prices, was also on track for a third straight weekly gain as the dollar lost ground amid increasing conviction in a September rate reduction.
Gold also benefited from increased safe haven demand earlier this week, sparked by concerns over stretched government debt in the developed world that sent sovereign bond yields rising. Uncertainty hovered around legal challenges to sweeping U.S. import tariffs and the Federal Reserve’s independence as well.
A host of Fed officials have signaled that the central bank was more open to cutting interest rates to help address persistent signs of a cooling U.S. labor market.
The much-anticipated key nonfarm payrolls report showed that employment growth came in at a languid 22,000 in August, well below economsts’ projections. Earlier in the week, a gauge of claims for unemployment benefits and a tracker of job openings both read weaker than expected, while private-sector hiring also eased.
Traders have ramped up their expectations for a rate cut as a result. Markets are now pricing in a nearly 100% chance the Fed will slash rates by 25 basis points at its September 16-17 meeting, according to CME’s FedWatch Tool.
Wider metal prices also advanced on Friday and were also headed for weekly gains. Spot platinum rose 0.9% to $1,388.13/oz and spot silver moved up by 1.5% to $41.2665/oz.
(Ambar Warrick contributed reporting.)