Gold prices remained largely flat in Asian trading Monday, pausing after a sharp 2% surge in the previous session. Investors responded to unexpectedly weak U.S. employment data and renewed geopolitical friction over U.S. trade policies under President Trump.
Spot Gold hovered at $3,360.26 per ounce, while Gold Futures for December edged up 0.2% to $3,412.70/oz as of 01:03 ET (05:03 GMT). Friday’s rally erased much of the metal’s prior weekly losses, pushing it into positive territory after two consecutive weeks of declines.
The latest U.S. nonfarm payrolls report showed job gains of just 73,000 in July, falling well short of economists’ expectations. In addition, previous months’ figures were revised downward, and the unemployment rate climbed to 4.2%, stoking concerns about the strength of the U.S. economy.
Markets quickly priced in a 90% probability of a Federal Reserve interest rate cut in September. Lower interest rates tend to weaken the dollar and reduce yields, both of which make non-yielding assets like gold more attractive.
Fed Cut Odds, Dollar Drop Boost Gold Demand
Gold’s rally was further supported by a broad retreat in the U.S. dollar. The Dollar Index fell 0.4% Monday, following a 0.8% decline on Friday. As the greenback weakens, gold becomes cheaper for non-dollar holders, increasing global demand.
Tariff tensions under President Trump added another layer of support. The administration moved forward with sweeping import duties targeting countries such as Canada, Brazil, India, and Taiwan. These tariffs are fueling inflation concerns and global trade uncertainty—conditions that bolster demand for safe-haven assets like bullion.
Key bullish factors influencing gold:
- 90% chance of Fed rate cut in September
- Weak July jobs report and downward revisions
- Unemployment at 4.2%, a 12-month high
- Dollar Index down 1.2% over two sessions
- Rising global trade tensions under U.S. tariffs
Copper Dips as U.S. Excludes Refined Metal from Tariffs
While gold held its ground, U.S. copper prices slipped 0.7% to $4.42/lb, dragged down by the Trump administration’s decision to exclude refined copper from a planned 50% import tariff. The move collapsed a previously profitable arbitrage trade, leading to a significant inventory buildup.
According to ING analysts, Comex copper stockpiles are at a 21-year high, and some of that surplus may soon be re-exported, pressuring international prices.
Meanwhile, London Copper Futures gained 0.3% to $9,672.75/ton, while Silver Futures rose 0.6% to $37.15/oz and Platinum Futures ticked up 0.2% to $1,318.65/oz.
With market sentiment hinging on rate policy and trade developments, gold appears poised to benefit from both economic caution and geopolitical instability.
