Gold takes a dive as US employment numbers suggest a less dovish Fed

7 Oct 2024 , 10:40 AM

Gold prices fell on Monday as chances increased for a lower U.S. rate decrease following a surprisingly strong jobs report, while market investors awaited inflation data and remarks from Federal Reserve members for more indications.

According to CME’s FedWatch tool, traders now perceive a 95% chance that the Fed will lower interest rates by only a quarter point in November. They have reduced their expectations for a 50 basis-point decrease to 0% from 28%.

Spot gold fell 0.1% to $2,650.79 per ounce. US gold futures increased 0.1% to $2,670.20.

Gold prices fell on Friday as a stronger-than-expected US jobs report dashed hopes for a sharp Fed rate cut next month, bolstering the currency.

In September, U.S. job additions climbed by the greatest in six months, and the unemployment rate decreased to 4.1%, indicating a strong economy.

Chicago Fed President Austan Goolsbee praised the latest U.S. jobs report as “superb” and said more labour market data along those lines will increase his confidence that the economy is at full employment with low inflation.

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