Gold rebounds above $4,100 after weak US payrolls

Gold surged past $4,100 on Thursday, climbing more than 2% to $4,130 an ounce after the Labor Department reported June non‑farm payrolls of just 57,000 – far below the 110,000 forecast and the slowest hiring pace in four months【1】. The surprise prompted traders to cut the probability of a September Fed rate hike to roughly 50%, down from about 66% before the data, lifting gold’s safe‑haven appeal.

What drove the move

The payroll miss was the catalyst that reshaped expectations for the Federal Reserve’s policy path. With the unemployment rate slipping to 4.2% as workers left the labor force, the market reassessed the need for a near‑term rate increase, pushing the CME FedWatch tool’s September‑hike probability to about 51%【1】. Lower rate‑hike odds reduce the opportunity cost of holding non‑yielding assets like gold, prompting the metal’s rebound.

At the same time, oil prices extended a third straight session of decline, helped by increased tanker traffic through the Strait of Hormuz and reports of progress in indirect U.S.–Iran talks, which further eased inflation concerns and removed a headwind for gold【1】. The dollar, which had been near its strongest level in more than a year, began its largest weekly slide since April, adding additional support for the precious metal【3】.

Market reaction

The gold rally spilled over into equity markets. In Australia, the ASX 200 jumped 1.37% to 8,844, with the Materials sector up 2.6% as gold miners rallied between 7% and 10% intraday, led by Catalyst Metals’ 19.2% surge after reporting record annual gold output【4】. The broader market’s bounce underscores how the payroll surprise not only lifted bullion but also buoyed commodity‑linked stocks.

What to watch

• Fed’s July 29 meeting – the next policy decision will confirm whether the market’s reduced hike expectations hold.
• U.S. CPI data – upcoming inflation numbers will test the durability of the dollar’s decline and gold’s appeal.
• Oil price trends – a reversal in crude prices could reignite inflation worries and affect gold’s momentum.

The rebound highlights how quickly macro data can shift risk sentiment and the pricing of safe‑haven assets. With the Fed’s policy outlook still in flux, gold’s trajectory will hinge on whether inflation and rate expectations continue to ease or rebound.