U.S. Nonfarm Payrolls Far Exceed Expectations, Gold Slightly Weakens

　　Source: Gold Investment Network (Jintou)

　　On Monday (September 7) during the European session, spot gold prices fell, with the latest gold price reported at $4410.68/ounce, down 0.26%. Spot gold opened at $4423.86/ounce, reached a high of $4429.24/ounce, and touched a low of $4389.52/ounce.

　　International gold prices started the week with a slight decline during the Asian session on Monday, with spot gold trading near $4400/ounce, continuing the previous retracement trend. The immediate catalyst for this drop in gold prices comes from the latest U.S. employment data. According to the U.S. Bureau of Labor Statistics, nonfarm payrolls increased by 162,000 in August, significantly exceeding market expectations of 56,000 and the July increase of around 21,000. Strong employment performance has changed market expectations for the Federal Reserve's short-term policy path, putting notable pressure on gold.

　　For gold, U.S. interest rate expectations are currently one of the most important pricing factors. Gold itself does not generate interest income, so when the market expects U.S. rates to remain high or rise further, the opportunity cost of holding gold relative to dollar assets increases. Thus, after the release of the nonfarm data, investors quickly raised bets on tighter Fed policy in September, leading to short-term profit-taking and capital outflows from gold.

　　The probability of the Fed raising rates by 25 basis points at its September meeting has already risen to about 58.3%, higher than the approximately 50.2% level before the data release. Market expectation shifts are directly reflected in precious metal prices. Independent analyst Tai Wang believes a strong employment report greatly increases the chance of a September hike, and unless the upcoming U.S. consumer price data is weak, gold could remain under short-term pressure.

　　However, the market cannot determine the future path of Fed policy based on one employment report alone. This week, the U.S. PPI and CPI will become new key variables. If producer and consumer price increases reaccelerate, the market may further bet on the Fed maintaining or even strengthening its tightening stance, which could continue to support the dollar and U.S. bond yields, while putting further downward pressure on gold.

　　Conversely, if U.S. inflation data falls below expectations, especially if core prices keep cooling, the rate hike expectations driven by employment data may reverse. At that point, the market will reassess whether the Fed really needs to take a more aggressive stance in September. Therefore, the decline around $4395 currently appears to be more of a short-term adjustment after repricing interest rate expectations, rather than a complete shift in the long-term bullish logic for gold.

　　Meanwhile, heightened risks to Middle East energy transportation further complicate gold's outlook. Regional tensions have remained elevated, and commercial shipping in the Strait of Hormuz is under close watch. If energy transport remains affected, international oil prices may stay high, contributing to global inflation pressures through higher energy costs. Typically, geopolitical risk upgrades can support gold via safe-haven demand. However, a particular dynamic is at play: if energy prices keep rising and rekindle market concerns on U.S. inflation, it may be harder for the Fed to switch quickly to easing policy. Thus, the safe-haven benefit from heightened geopolitical risk for gold could be partially offset by a negative chain of "rising oil prices → heightened inflation expectations → high rates maintained."

　　This is an important reason why gold's recent price action has diverged from traditional safe-haven logic. Investors are not just focused on military risks themselves, but on whether these risks further affect energy supply, inflation, and major central bank policy paths. If oil prices rise but U.S. inflation data is weak, gold may regain dual support from safe-haven and easing expectations; if oil prices rise while reigniting U.S. inflation, gold could remain under pressure in the short term.

　　From a capital flow perspective, gold had seen significant appreciation recently, accumulating some profit-taking potential. The surprise nonfarm data became a key catalyst for profit-taking. With Fed policy expectations not yet fully stabilized, gold markets may remain highly volatile. The key area to watch now is whether the $4395–4405 range can offer effective support, and whether prices can reclaim the $4465 level after rebounding.

　　Previously, Commerzbank noted growing market disagreement behind gold’s recent rebound, with some investors beginning to question whether the Fed will actually continue tightening in September. The previously cautious remarks from Fed Governor Christopher Waller also drove the market to reassess the probability of further hikes. This suggests that the gold market is not operating on a one-sided bearish narrative, and future moves will hinge on U.S. inflation data and Fed officials’ speeches.

　　From the perspective of global asset allocation, gold still has strategic value. On one hand, global geopolitical risk and energy supply uncertainties remain; on the other, there’s still divergence in long-term market views on U.S. fiscal policy, interest rates, and dollar trends. Even if strong employment data suppresses gold prices in the short term, as long as there isn’t obvious capital flight in the medium-to-long term, price corrections could still attract new dip buying.

　　The daily chart for gold continues to exhibit resilience. Spot gold remains above its 100-day simple moving average at around $4350, so the medium-term bullish structure is not yet broken. However, the price has fallen below the middle band of the 20-day Bollinger at about $4465, indicating a clear consolidation phase after previous rapid gains. The 14-day RSI is around 51, down from previously high levels to neutral territory, meaning bullish overheating has eased, but no clear oversold condition has formed. Resistance is first seen near $4465; if this level is regained, further resistance lies near $4675. On the downside, first watch $4405–4395; if this area fails, a test of the 100-day MA at $4350 is possible, and if that breaks, further downside toward the Bollinger lower band around $4260 can be watched.

　　On the 4-hour chart, gold remains in a weak structure after the retracement, with $4395 currently a key battleground between bulls and bears. If price finds support near $4400 and breaks above the $4435–4465 zone, 4-hour momentum could gradually recover, with rebound targets toward $4500. Conversely, if price stays below $4465 and decisively breaks $4395, short-term bears may remain in control, with $4350 as the next crucial support. Short-term momentum indicators such as MACD should be watched for bottoming signals. Whether $4395 holds will directly affect if the gold correction is a normal pullback or the start of a deeper downtrend.

　　The much stronger-than-expected August U.S. nonfarm payroll data has clearly heightened September rate hike expectations from the Fed, which is the main reason for this rapid gold price correction. In the short term, the dollar and rate expectations may continue to pressure gold prices, while inflation risks from higher energy prices also add to market uncertainty.

　　However, it is not sufficient yet to declare an end to gold's medium-term bullish structure. The $4395–4350 zone is now an important support area; as long as it holds, gold still has the potential to recover upwards. The real key for future trends will be whether U.S. PPI and CPI data confirm market expectations for further tightening from the Fed.

　　If U.S. inflation heats up again, gold may look for support at $4350 or even $4260; if inflation data cools significantly and the Fed weakens rate hike expectations, gold could challenge $4465 and recover toward $4675. The core contradiction in gold now is not simply safe-haven demand, but the rebalancing between "geopolitical risk support" and "high rates, strong dollar pressure." Thus, short-term volatility may intensify further, but medium and long term moves will still depend on real interest rates, dollar trends, central bank gold buying, and global risk asset allocation shifts.

　　Spot gold prices are currently down, with the latest price at $4410.68/ounce, a decline of 0.26%. The high was $4429.24/ounce, and the low was $4389.52/ounce. For spot gold, support is watched near $4405 or around $4390/75; resistance is monitored near $4465 or $4500.

Editor: Zhu Henan