Gold remains calm even as cooling labor market boosts Fed pause bets

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Gold price (XAU/USD) traded back and forth from the past four trading sessions even though cooling labor market conditions boosted the Federal Reserve

’s soft landing hopes. A softening job market could mean that the Fed’s interest rate hike in July was the last one in the current policy tightening spell. The precious metal remains calm, but a power-pack action is expected after the release of the Services PMI data on Wednesday.

Cleveland Fed Bank President Loretta Mester said on Friday that demand and supply in the labor market is coming into a better balance but the job market is still strong. She further added that while job growth has slowed and job openings are down, the Unemployment Rate is low. Investors hope that the US labor market will continue to cool down due to hefty interest rate hikes, prompting the Fed to keep interest rates unchanged for the remainder of the year.

While the majority of economies are experiencing a vulnerable real estate sector, the US Commerce Department said on Friday that construction spending rose 0.7% as outlays on single-home projects rose due to limited supply.This week, investors will keep focus on the ISM Services PMI for August, which will be published on Wednesday at 14:00 GMT. The PMI is expected to be broadly steady at 52.6.

 

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