Everbright Futures 0903 Gold Review: US ADP Employment Data Weakens, Will Gold Go Up or Down?

Overnight, London spot precious metals fluctuated higher. US ADP employment data weakened significantly, and the market is focusing on Friday’s non-farm payroll data. US Treasury yields and the US dollar both retreated from recent highs. Combined with previous overselling of gold and subsequent price recovery, geopolitical risks and central bank gold purchases are providing a base of support. In the short term, gold volatility is intensifying; attention is on Friday’s non-farm payroll data for further guidance.

On the macro front, in August, ADP employment in the US increased by 37,000, lower than the previous value of 46,000, marking the smallest monthly gain since January this year. The Federal Reserve’s Beige Book released yesterday showed that US economic activity has expanded moderately recently, employment has grown slightly, and price increases are moderate, with data center demand becoming the main driver of growth. The New York Fed president made cautious remarks, refraining from giving clear signals about rate hikes, stating “just need to keep observing” the data trend. Geopolitically, Middle East conflict has escalated rapidly, with both sides announcing strikes on the same day. Last night’s US employment data was soft, causing the market to swing once again on whether the Federal Reserve will raise rates in September, which helped gold prices rebound after falling. However, the escalation of US-Iran tensions and rising oil prices, combined with the previously hawkish speech by Federal Reserve Chair Walsh, make renewed rate hikes a likely topic in September. As a result, gold should still be approached with caution. Keep an eye on Friday’s non-farm payroll data for guidance.

Written by: Li Qi

Professional Qualification: F3046227

Trading Advisory Qualification: Z0016145

Editor: Zhu Henan