Fed39;s Daly says rate cuts needed to keep labour market healthy
Traders see 45 chance of 50basis point Fed rate cut this month
2,600 viable target for gold before yearend analyst
Sept 5 Reuters Gold was little changed on Thursday as investors kept to the sidelines ahead of U.S. payrolls data that could provide more clues on the size of an expected rate cut this month.
Spot gold steadied at 2,494.73 per ounce by 0440 GMT. U.S. gold futures lost 0.1 to 2,524.90.
Nonyielding bullion tends to perform well when interest rates are low. It is also considered a hedge against economic and political uncertainties.
Data overnight showed that U.S. job openings dropped to a 312year low in July, suggesting the labour market was losing steam, but the reduction on its own is probably not enough to warrant a halfpercentagepoint rate cut by the Federal Reserve this month.
San Francisco Fed President Mary Daly said that rate cuts were needed to keep the labour market healthy.
Traders raised the odds of a 50basispoint rate cut on Sept. 18 to 45 from 38, according to the CME FedWatch Tool. The U.S. nonfarm payrolls NFP report due on Friday is pivotal for Fed expectations.
If the NFP figures undershoot expectations, it would bring a 50bp cut back into the picture, likely denting the dollar and boosting gold, said Tim Waterer, chief market analyst, KCM Trade.
The highs for gold in 2024 may not yet have been reached, with the 2,600 level a viable target before yearend, if the Fed…