The path to a peak of $3600 for world gold prices.

World gold prices hit a new record, nearing $3600/ounce. Following the release of US August employment data, non-farm employment figures were significantly lower than forecasts.

Gold prices continued their sharp rise, setting a new record high on Friday. The price approached the $3,600 per ounce mark. This was primarily driven by weaker-than-expected US employment data for August, significantly bolstering expectations of an early interest rate cut by the Federal Reserve.

At 04:00 GMT+7, spot gold prices rose 1.4% to $3,596.49 per ounce, after touching a record high of $3,596.76. Gold is expected to have its strongest weekly gain in nearly four months. US December gold futures also rose 1.3% to $3,653.30.

The gold market is once again attracting safe-haven investments. This is because the US labor market is losing momentum faster than expected.

The recently released US August jobs report showed that key non- farm jobs increased by only 22,000, far below expectations of a 75,000 increase. Following the jobs report, the market now expects the Fed to cut interest rates three more times, each by 0.25%, this year.

At the same time, the unemployment rate rose slightly to 4.3% from 4.2% in July. This increase is in line with previous forecasts.

The market is also very sensitive to revised figures. The June employment data was revised down by 13,000 jobs, while the July figure was slightly revised up by 79,000 jobs.

The report states that, with these adjustments, the total number of jobs in June and July was 21,000 lower than previously reported.

Despite the slowdown in job growth, the report also showed fairly solid wage increases. Last month, average hourly earnings rose 10 cents, or 0.3%, to $36.53, in line with expectations.

The report states that average hourly earnings have increased by 3.7% over the past 12 months.

The weakening US labor market is reinforcing expectations that the Federal Reserve (Fed) will aggressively cut interest rates for the remainder of the year. Markets still expect a 0.25% cut later this month and forecast a potential total rate reduction of one percentage point by the end of the year.

In a commentary, Suki Cooper, an expert from Standard Chartered Bank, warned that if job growth falls below 40,000, the market could begin to expect a 0.5% rate cut later this month.

Expectations of interest rate cuts continue to rise as inflationary pressures remain high. Analysts believe this is a favorable environment for gold, due to the increasing risk of stagflation.

According to expert Aakash Doshi, if the current trend continues, the US economy could enter a stagflation period within the next 3 to 6 months, potentially pushing gold prices up to $4,000 per ounce.

Expert Mohammed Taha said the August employment data is the latest report confirming the increasingly clear weakening of the labor market. Disappointing figures were also reported from ADP, a private sector payroll processing company. The US Department of Labor also reported a sharp decline in job openings in July.

According to Taha, the 22,000 jobs could push gold prices toward $3,600 per ounce or set a new record, driven by increased demand for safe haven assets amid economic uncertainty and potential geopolitical tensions. The large discrepancy in the data suggests very strong upward momentum for gold.

However, Jeffrey Roach, chief economist at LPL Financial, believes that while the labor market is slowing, it may not be enough to force the Fed to cut rates by 0.50% later this month.

Fed policymakers will likely focus on weaknesses in the labor market to justify interest rate cuts. Labor data may not be weak enough for a 0.5% cut due to persistent inflation, so current expectations remain for a 0.25% reduction.

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Source: https://baonghean.vn/duong-len-dinh-3600-usd-cua-gia-vang-the-gioi-10305923.html