Gold prices are trading in the green on Wednesday, not far from the all-time high recorded on Tuesday. Renewed Fed rate cut bets following the massive downward revisions to the jobs data in the U.S. on Tuesday as well as the recent geopolitical developments in the Middle East bolstered demand for the yellow metal. Both Spot Gold and Gold Futures recorded gains in Wednesday's trade.
The U.S. Bureau of Labor Statistics had on Tuesday announced an annual downward revision of 911 thousand to the nonfarm payrolls. Markets had anticipated a downsizing of 818 thousand only.
The softening in the labor market is seen goading the Fed to ease rates. The CME FedWatch tool that tracks the expectations of interest rate traders currently shows the likelihood of a quarter-percentage rate cut by the Federal Reserve next week at 91.7 percent. Markets also anticipate a probability of 8.3 percent for a 50-basis points rate cut.
However, rate cut expectations and the yellow metal's price movements over the course of the day have been impacted by anxiety ahead of the release of producer price inflation readings for August due from the U.S. on Wednesday morning.
Markets expect the headline and core month-on-month inflation to ease to 0.3 percent from 0.9 percent in the previous month.
The consumer price inflation readings for the same period are due on Thursday.
Gold Futures for December settlement gained 0.17 percent overnight to trade at $3,688.40, versus the previous close of $3,682.20. The day's trading range has been between $3,657.92 and $3,696.45 as compared with the 52-week trading that ranged between $2,505.7 and $3,715.20.
With today's addition, weekly gains stand at 1.5 percent and monthly gains add up to 8.4 percent. Amidst year-to-date gains of close to 40 percent, the price surge over the 3-year horizon is now almost 115 percent.
Spot Gold rallied 0.61 percent overnight to trade at $3,648.40 per troy ounce. The day's trading range has been between $3,620.90 and $3,657.50. Spot Gold had ranged between $2,500.16 and $3,674.09 over the past 52 weeks.
At current prices, Gold Futures has gained more than 47 percent and Spot Gold has gained more than 46 percent over the past year.
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