Gold Prices Forecast: Analyzing the Impact of ADP Jobs Report and Fed Rate Cuts

Thursday, 5 September 2024, 04:30

Gold prices forecast remains bullish as traders eye the ADP jobs report. Expectations of Fed rate cuts are influencing gold prices, setting the stage for potential gains. The market anticipates a strong correlation between job data and the Fed's upcoming decisions, directly impacting gold's performance.
FX Empire
Gold Prices Forecast: Analyzing the Impact of ADP Jobs Report and Fed Rate Cuts

Gold Prices on the Rise

Gold prices surged nearly 1% on Thursday, recovering from recent lows, as buyers defended key support levels. After rebounding from Wednesday’s bottom of $2,471.91, gold recaptured the $2,501.31 pivot, positioning it close to the record high of $2,531.77. The rise in gold prices is driven by increasing expectations of a more aggressive U.S. Federal Reserve rate-cutting cycle.

Fed Rate Cuts and ETF Buying

The primary driver of Thursday’s rally is the belief that the Federal Reserve will initiate substantial rate cuts due to signs of a slowing U.S. economy. Recent job data showed openings fell to a three-and-a-half-year low, impacting market sentiment.

Market Movements

  • At 11:22 GMT, XAU/USD is trading at $2,516.19, up $20.65 (+0.83%).
  • 58% chance of a 25-basis-point rate cut expected.
  • ETF interest in gold is rising as Treasury yields fall.

Upcoming ADP Report

The ADP Employment Change report is expected to show a private-sector job growth of 144,000 in August, impacting Fed's decisions. Any surprises could shift outlook on rate cuts.

Short-Term Outlook for Gold

Given the economic indicators and expectations of further rate cuts, the short-term outlook for gold remains bullish. Central banks continue to pursue gold, maintaining its appeal as a safe-haven investment.


This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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