SINGAPORE: Gold prices inched up for the fourth session in a row on Tuesday, as a weaker dollar and falling US Treasury yields boosted demand for the precious metal. Fresh signs of a slowdown in the US job market added to expectations that the Federal Reserve may soon cut interest rates.
By 2:39am GMT, spot gold had gained 0.1 percent to reach $3,375.89 an ounce, while US gold futures also rose 0.1 percent to $3,430.40.
The dollar index hovered near a one-week low, making gold more attractive to buyers using other currencies. Meanwhile, yields on the 10-year US Treasury note dropped to their lowest level in a month.
“Short-term momentum is turning in favour of gold,” said Kelvin Wong, a senior market analyst at OANDA. “The broader story remains that the Fed is likely to cut rates in September.”
Recent US jobs data has strengthened that view. Employment growth in July fell short of expectations, and job figures for May and June were revised down by a combined 258,000. The weaker numbers suggest the labour market is losing steam.
As a result, traders now place a 92 percent chance on a rate cut in September, according to the CME FedWatch tool.
Supporting this outlook, San Francisco Fed President Mary Daly said on Monday that growing signs of a cooling job market and no lasting inflation pressure from tariffs make the case for rate cuts stronger.
Gold often performs well during times of economic or political uncertainty. It also tends to benefit when interest rates are low, as it doesn’t earn interest like other assets.
However, gold’s climb could face some hurdles. “I still don’t see traders pushing the price strongly above $3,450 unless there’s a clear trigger,” Wong added.
In other precious metals, silver rose 0.1 percent to $37.44 an ounce, platinum also added 0.1 percent to $1,330.31, and palladium gained 0.2 percent to $1,204.25.
On the trade front, tensions between the US and India escalated after President Donald Trump once again threatened to raise tariffs on Indian goods due to its oil imports from Russia. India dismissed the warning as “unjustified” and pledged to defend its economic interests, fuelling uncertainty in global trade relations.
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