Gold prices slipped on Thursday as stronger-than-expected US labor and manufacturing data offset optimism from the Federal Reserve’s first interest rate cut in nine months.
Spot gold eased about 0.4% to $3,643/oz, retreating from earlier highs near $3,670. The move came as US initial jobless claims fell to 231,000, well below market forecasts, while manufacturing output rose 0.2% in August, reversing a July decline. The upbeat data supported the dollar and Treasury yields, pressuring bullion.
On Wednesday, the Fed lowered its benchmark rate by 25 basis points to a range of 4.00%–4.25%, with Chair Jerome Powell framing the move as a risk-management step amid signs of softer employment. Markets had expected the cut to provide stronger support for gold, but the resilience in US indicators tempered those gains.
“There was some confusion around Powell’s comment about the rate cut being a risk-management measure, and that uncertainty prompted profit-taking,” Peter Grant, Vice President and Senior Metals Strategist at Zaner Metals, told Reuters. He added: “But I do think gold’s long-term bullish trend still remains and the setback from yesterday’s all-time high is corrective in nature.”
Analysts say the near-term outlook depends on upcoming inflation readings and the Fed’s next meeting in October. Gold is likely to consolidate in the $3,600–$3,700 range, with further upside contingent on signs of labor market weakness or a softer dollar.
