Gold Surges as Soft US Jobs Data Erodes Fed Hike Bets

Gold prices rallied sharply on Friday, with spot XAU/USD surging more than 2.3% during the session to notch a weekly gain above 7%. The move came after a mixed US employment report revealed a softer increase in nonfarm payrolls, calling into question the pace of future Federal Reserve tightening.

The disappointing payrolls figure crushed market expectations for additional rate hikes, triggering a repricing of interest rate futures. Lower rates tend to support gold by reducing the opportunity cost of holding the non-yielding asset.

The unemployment rate held steady, but the weak headline jobs number was enough to fuel a broad sell-off in the US dollar, adding further momentum to the precious metal’s rally.