Last night, when the Non-farm data was released, the unemployment rate rose to 4.6% while average earnings dropped sharply to just 0.1%. Although there was a slight recovery in non-farm payrolls, it was not enough to restore investor confidence in the U.S. labor market.
At the same time, both U.S. retail sales data and the services PMI declined significantly, indicating that the world’s largest economy is showing signs of weakening.
As a result, gold prices were strongly supported and rebounded to the 432x–433x USD/ounce zone. However, buying momentum suggests that investors are not yet ready for a breakout at this time and are instead focusing their attention on the CPI data to be released tomorrow night. The CPI index is likely to provide further signals regarding future interest rate adjustments by the FED and will be the key factor determining the next trend for gold.
Currently, the upward trend remains dominant, and if U.S. inflation continues to improve, interest rate cuts will likely proceed, allowing gold prices to rise further in the future.
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