FX.co ★ AB2 | GOLD,XAUUSD ANALYSIS

XAU/USD

US NFP fails estimates, with past months receiving dramatic downward revisions.As markets reduce the likelihood of a September Fed rise, the US dollar declines.Fed Warsh and Daly maintain a laser-like focus on inflation threats.Gold (XAU/USD) price surges over 2% on Thursday as the latest US jobs report reduced the prospects of a Federal Reserve (Fed) rate hike and pushed the US Dollar (USD) and US Treasury yields lower. After rising from daily lows of $4,032, the XAU/USD pair is currently trading at $4,111.The US Bureau of Labor Statistics (BLS) announced June’s employment data, with Nonfarm Payrolls falling short of predictions of 110K, coming at 57K. The estimates for May and April were also lowered, going from 172K to 129K and from 179K to 148K, respectively. Due to a decline in labor force participation, the unemployment rate dropped from 4.3% to 4.2% at the same time. The US dollar continued to lose ground throughout the day, with the US Dollar Index (DXY), which measures the value of the US dollar relative to six other currencies, falling 0.55% to 100.85.As investors reduced their hawkish wagers on the Federal Reserve, US Treasury yields also suffered. After erasing some of its prior losses, the yield on the US 10-year benchmark note is 4.483%, unchanged.However, according to Prime Terminal data, money markets are still putting in a 66% possibility of a rate hike at the September 16 meeting, with investors anticipating a tightening of over 17 basis points.Meanwhile, Federal Reserve officials crossed the wires. Mary Daly of the San Francisco Fed observes rising costs as a result of tariffs and oil shocks, but she also sees encouraging indications in the US economy. Although she acknowledges situations in which the Fed must combat inflation, she claims the policy is "slightly restrictive."