By Sherin Elizabeth Varghese
(Reuters) – Gold surged past the $3,600 an ounce level for the first time on Monday, hitting a record high, as soft U.S. labor data reinforced expectations the U.S. Federal Reserve will cut interest rates next week.
Spot gold rose 1.3% to $3,634.25 per ounce, as of 2:26 p.m. EDT (1826 GMT). Bullion hit a record high of $3,646.29.
U.S. gold futures for December delivery settled 0.7% higher at $3,677.40.
The yellow metal could extend its momentum toward $3,700–$3,730 in the near-term, with any brief pullbacks likely seen as buying opportunities, said Peter Grant, vice president and senior metals strategist at Zaner Metals.
“Continued labor market softness and expectations of ongoing Fed rate cuts into early 2026 could provide sustained support for bullion.”
Friday’s jobs report showed U.S. employment growth slowed sharply in August. Traders now see a 88% chance of a quarter-point rate cut at the Fed’s September meeting, with around 12% chance of a larger 50-bps cut, according to the CME FedWatch tool.
Lower rates reduce the opportunity cost of holding non-yielding bullion.
Gold prices are up 37% so far this year, after gaining 27% in 2024, bolstered by dollar softness, strong central bank accumulation, dovish monetary settings and heightened global uncertainty.
China’s central bank extended its gold-buying streak to a 10th straight month in August, official data showed on Sunday.
Benchmark 10-year U.S. Treasury yields, meanwhile, were at their lowest in five months. [US/]
Investors are now awaiting U.S. producer price data on Wednesday and consumer prices on Thursday for further clues on the Fed’s policy path.
“If weakness in U.S. data continues, then so too should the ongoing bullish momentum in gold, as both the U.S. dollar and yields fall further,” said Fawad Razaqzada, market analyst at City Index and FOREX.com. [USD/]
Conversely, Razaqzada added, “If the U.S. data shows surprise resilience in the coming weeks, then that might cause gold to correct from these elevated levels.”
Elsewhere, spot silver rose 0.8% to $41.29 per ounce, touching its highest since September 2011, earlier in the session. Platinum was up 0.6% at $1,381.49, and palladium gained 2.1% to $1,132.87.
(Reporting by Sherin Elizabeth Varghese and Anushree Mukherjee in Bengaluru; Additional reporting by Sarah Qureshi; Editing by Shailesh Kuber, Vijay Kishore and Mohammed Safi Shamsi)
