Gold Jumps after Cooling US Jobs Report Boosts Rate Cut Hopes

Marked ingots of 99.99 percent pure gold are placed in a cart at the Krastsvetmet non-ferrous metals plant in the Siberian city of Krasnoyarsk, Russia March 10, 2022. REUTERS/Alexander Manzyuk/File Photo
Marked ingots of 99.99 percent pure gold are placed in a cart at the Krastsvetmet non-ferrous metals plant in the Siberian city of Krasnoyarsk, Russia March 10, 2022. REUTERS/Alexander Manzyuk/File Photo
TT

Gold Jumps after Cooling US Jobs Report Boosts Rate Cut Hopes

Marked ingots of 99.99 percent pure gold are placed in a cart at the Krastsvetmet non-ferrous metals plant in the Siberian city of Krasnoyarsk, Russia March 10, 2022. REUTERS/Alexander Manzyuk/File Photo
Marked ingots of 99.99 percent pure gold are placed in a cart at the Krastsvetmet non-ferrous metals plant in the Siberian city of Krasnoyarsk, Russia March 10, 2022. REUTERS/Alexander Manzyuk/File Photo

Gold prices hit their highest in over two weeks on Friday as Treasury yields and the dollar declined after data showed US economy created fewer jobs than expected in July, boosting hopes of rate cuts by the Federal Reserve this year, Reuters reported.

Spot gold was up 0.8% at $2,464.32 per ounce as of 1320 GMT, just $19 shy of the record peak of $2,483.60 scaled on July 17. US gold futures climbed 1% to $2,506.60.

"The drop in yields along with the reaffirmation that there is a cut in September just makes gold a lot more attractive," said Alex Ebkarian, chief operating officer at Allegiance Gold.

US 10-year yields dropped to their lowest since December and the dollar hit its lowest since March after data showed that employers added fewer jobs in July than economists had forecast, while the unemployment rate increased to 4.3%.

The data follows comments from Fed Chair Jerome Powell who on Wednesday said that rates could be cut as soon as September if the US economy follows its expected path.

Gold has gained 3.2% so far this week, on track for its best week since April, as rising safe-haven demand from Middle East tensions and expectations of rate cuts made the metal more appealing for investors.

Bullion is traditionally considered a hedge against geopolitical and economic risks, and lower interest rates reduce the opportunity cost of holding the asset.

"The marketplace just now is factoring in a better-than-70% chance for a 50-basis-point cut by the Fed at the September FOMC meeting," said Jim Wyckoff, senior market analyst at Kitco Metals in a note.

Elsewhere, spot silver added 1.2% to $28.88 per ounce, platinum rose 1.3% to $971.20 and palladium dropped 0.4% to $901.82. All three metals were headed for weekly gains.



Global Electricity Demand to Grow by 4% through 2027, IEA Says

Smoke rises from power plant smokestacks at dusk in Chisinau, Moldova, 12 February 2025. (EPA)
Smoke rises from power plant smokestacks at dusk in Chisinau, Moldova, 12 February 2025. (EPA)
TT

Global Electricity Demand to Grow by 4% through 2027, IEA Says

Smoke rises from power plant smokestacks at dusk in Chisinau, Moldova, 12 February 2025. (EPA)
Smoke rises from power plant smokestacks at dusk in Chisinau, Moldova, 12 February 2025. (EPA)

Global electricity demand is expected to grow by more than the total consumption of Japan each year through 2027, but the expansion of low-emissions energy sources should help offset the trend, the IEA said in a report on Friday.

Emerging and developing economies are expected to account for 85% of global demand growth, with China forecast to make up more than half of the gains with a 6% growth rate year-on-year to 2027, the IEA report said.

China's power demand has grown faster than its economy since 2020, spurred by a power-hungry industrial sector and the rapid expansion of electricity-intensive manufacturing of solar panels, batteries, EVs and associated materials, the report said.

Air conditioning, data centers and 5G networks are seen as additional contributors.

India is also expected to be a major contributor, accounting for 10% of the global increase, with robust economic activity and rapidly rising air conditioning.

Some advanced economies like the US are seen reversing previously stagnant demand as electrification grows rapidly for sectors like transport, heating and data centers, the IEA said.

Expectations for the European Union were revised down from the IEA's July forecast due to a weaker macroeconomic outlook, falling one percentage point to 1.6% growth expected in 2025.

The bloc is not expected to recover to its 2021 demand level until at least 2027 despite growing in 2024 after two years of flagging demand, the report said.

Low-emissions energy sources such as renewables and nuclear are expected to be able to match global demand growth trends as they continue to edge out coal's share in the power mix, the report said.

Solar is expected to be the second largest low-emissions source in 2027 behind hydropower, while renewables as a whole are expected to eclipse coal-fired generation in 2025 as the polluting resource's share will slip below 33% for the first time in 100 years.