The August jobs report was a positive one with continued employment gains but also healthy increase in labour force.
Non-farm payrolls rose by 315,000. Employment rose by a very strong 442,000. But there was also an unexpected 786,000 surge in the labor force which helped raise the unemployment rate up from 3.5% to 3.7%. Average hourly earnings for all workers also rose by a moderate 0.3% but slightly slower than the consensus expectation.
In my opinion, we could expect the Federal Reserve to continue to raise rates by 75 bps in Sept. We should continue to keep an eye on commodities prices. Should commodities prices decrease, it increases the odds that the economy could return to milder inflation which is when the Fed will reduce their rate hikes intensity.
Therefore for the outlook of XAUUSD, I expect today's rally to be short-lived, just like asset classes such as Equities and Fixed Income. With the expectation of continued rate hikes in Sept, dollar is expected to rally still. Therefore, I remain bearish on spot gold for now.
Non-farm payrolls rose by 315,000. Employment rose by a very strong 442,000. But there was also an unexpected 786,000 surge in the labor force which helped raise the unemployment rate up from 3.5% to 3.7%. Average hourly earnings for all workers also rose by a moderate 0.3% but slightly slower than the consensus expectation.
In my opinion, we could expect the Federal Reserve to continue to raise rates by 75 bps in Sept. We should continue to keep an eye on commodities prices. Should commodities prices decrease, it increases the odds that the economy could return to milder inflation which is when the Fed will reduce their rate hikes intensity.
Therefore for the outlook of XAUUSD, I expect today's rally to be short-lived, just like asset classes such as Equities and Fixed Income. With the expectation of continued rate hikes in Sept, dollar is expected to rally still. Therefore, I remain bearish on spot gold for now.