Weaker US jobs data and easing oil-driven inflation risks reduce expectations for aggressive Fed tightening.
Gold prices retreated to around $4,150 after briefly touching $4,200 during Asian trading, pressured by a stronger USD and profit-taking. The pullback follows last week’s rebound from a seven-month low of $3,941.
Traders scaled back bets on an immediate Fed rate hike after softer-than-expected US Nonfarm Payrolls data. Easing tensions in the Strait of Hormuz also reduced oil-driven inflation concerns, suggesting less urgency for aggressive monetary policy.
Markets now price a 56% chance of a September rate increase, per the CME FedWatch Tool. Fed officials reiterated commitment to the 2% inflation target but signaled flexibility on timing.