Gold (XAU/USD) is pausing on Thursday after a historic run that lifted prices to a new record of $3,578.50 on Wednesday. During the US session, the metal is hovering around $3,548, having briefly dipped toward $3,510 earlier. The pullback comes as investors lock in profits and a firmer US Dollar tempers momentum, while calmer bond markets also reduce immediate safe-haven flows.
Despite the pause, the broader uptrend in bullion remains strong. Expectations are growing that the Federal Reserve will cut interest rates at its September 16–17 meeting, which lowers the cost of holding non-yielding assets like gold. A softer Dollar, lingering trade tensions, and concerns over fiscal stability in major economies continue to provide an underlying bid for the metal.
Fresh US labour data added to the case for Fed easing. The ADP report showed private payrolls rising by just 54,000 in August, well below July’s revised 106,000 and under the 65,000 forecast, hinting at slowing hiring. Initial Jobless Claims also rose slightly to 237,000, pointing to a modest uptick in layoffs. However, productivity data was more encouraging, with Q2 Nonfarm Productivity revised higher to 3.3% while Unit Labour Costs eased to 1.0%, suggesting wage pressures are cooling. Traders now await Friday’s Nonfarm Payrolls (NFP) for clearer confirmation of labour market trends.
Meanwhile, the US Dollar Index (DXY) is holding steady near 98.40, as markets digest mixed US data. Treasury yields eased slightly, cushioning gold from sharper declines, with the 10-year yield at 4.19% and the 30-year near 4.89%. Softer yields remain supportive for bullion.
On the data front, S&P Global’s Composite PMI slipped to 54.6 from 55.4, while the ISM Services PMI rose to 52.0, above expectations of 51.0. Sub-indices showed stronger new orders, but employment softened, reinforcing the mixed labour market outlook. Global bond markets also stabilized after recent turmoil, with strong auctions in Japan and assurances from UK policymakers helping ease investor nerves.
Political and legal headlines added to the backdrop, as the Trump administration asked the US Supreme Court to reinstate its global tariffs, which lower courts previously ruled against. The case adds uncertainty to the broader economic outlook, supporting safe-haven demand.
The CME FedWatch tool now shows nearly 97% odds of a 25 bps Fed rate cut in September. Fed officials have also struck a dovish tone, with Governor Waller saying cuts should begin “at the next meeting,” and Atlanta Fed President Bostic suggesting easing will likely be needed this year.
Technical outlook:
Gold is consolidating after Wednesday’s surge, with the Relative Strength Index (RSI) still overbought above 70 but pointing lower, signalling potential for a pause or mild correction. The price also hovers at the top of the Bollinger Bands, highlighting strong bullish momentum but also overextension.
Immediate support lies at $3,511, followed by the psychological $3,500 level. Deeper pullbacks could target $3,450, a former resistance now turned support. On the upside, $3,578 remains the key resistance, and a break above could open the path toward $3,600.
