Gold prices experienced a retreat overnight, driven by increased uncertainty surrounding the likelihood of another interest rate cut by the US Federal Reserve this year, according to ANZ. The September US jobs report presented a mixed picture, with headline growth surpassing expectations, yet the unemployment rate continued its upward trajectory. ANZ analysts suggest this combination underscores the underlying fragility within the labour market. This divergence has led to a split among Fed officials regarding the necessity of further easing measures.
ANZ noted that Chicago Fed president Austan Goolsbee expressed renewed caution following the release of the jobs data. Goolsbee indicated that he remains uncertain about supporting another rate cut at the central bank’s December meeting. These doubts concerning the future policy outlook exerted downward pressure on base metals. Copper, which had previously risen on optimism surrounding potential new stimulus measures from China, reversed its gains in the wake of the US jobs report.
Earlier, market sentiment had briefly improved following reports that Beijing is considering implementing fresh support measures aimed at revitalising its weakening property sector. The potential measures include mortgage subsidies for first-home buyers, increased income-tax rebates for mortgage holders, and reductions in transaction costs. However, the uncertainty surrounding US monetary policy continues to dominate market sentiment.
ANZ is a leading banking and financial services group, operating in Australia, New Zealand and Asia Pacific. They provide a range of services including retail, commercial and institutional banking, as well as wealth management.
