US August Nonfarm Payrolls Exceed Expectations by a Wide Margin, Gold Prices Continue Weak Consolidation

On September 7, due to "explosive" nonfarm payroll data for August, spot gold continued its weak and volatile trend, with prices hovering around the $4,400/ounce mark. Specifically, after seasonal adjustment, US nonfarm payrolls for August recorded 162,000, the highest since March and much higher than the market's expectation of 56,000. The US unemployment rate for August remained unchanged at 4.1%, in line with market expectations.

For gold, US interest rate expectations are currently one of the most important pricing factors. Since gold does not generate interest income, when the market anticipates US rates to remain high or even rise further, the opportunity cost of holding gold versus dollar assets increases. Thus, after the release of the nonfarm data, investors quickly raised their bets on a Federal Reserve policy tightening in September, resulting in short-term profit-taking and capital withdrawals from gold.

According to Everbright Futures, there is significant uncertainty around the Federal Reserve's September rate decision. Gold may pay more attention to the performance of US economic and inflation data, and price movements could also fluctuate repeatedly. They recommend a flexible strategy within a trading range.

Editor: Zhu Henan