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Gold Down As Strong US NFP Report Dims Hopes For Fed Rate Cut In July
Friday, 4 July 2025 02:00 WIB | GOLD |GOLDEMAS

Gold prices fell 0.80% on Thursday (03/07) as a strong US Nonfarm Payrolls report strengthened the US Dollar, leading market participants to believe that the Fed is unlikely to cut interest rates at its July meeting. At the time of writing, XAU/USD was trading at $3,332, having hit an intraday high of $3,365.

The US June jobs report beat estimates and also surpassed May's reading. It is worth noting that the Unemployment Rate fell close to the 4% threshold, indicating that the labor market remains solid. The data called into question Wednesday's ADP National Employment Change report, which showed that private employers cut hiring by -33K.

As a result, the Greenback rose, supported by a surge in US Treasury yields. Futures data showed that investors are pricing in two interest rate cuts by the end of 2025, as opposed to the 65 basis points (bps) of easing expected in early July.

The data reaffirmed the Federal Reserve's stance to keep interest rates steady until it sees signs of weakness in the labor market or a resumption of deflation.

In addition, US Treasury Secretary Scott Bessent announced that more trade deals are expected, following the announcement of the Vietnam agreement. He added that the Fed is the one that decides interest rates and hinted that the administration will start working on Powell's replacement in the fall.

Meanwhile, the US House of Representatives passed Trump's "One Big Beautiful Bill" to a final vote. The fiscal budget is expected to increase US debt by $3.3 trillion over the next decade. (alg)

Source: FXstreet

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