Gold trading reminder: Gold prices hit a new high, and non-agricultural data is coming!

Gold prices continued their rally on Thursday.Spot goldRefresh the record high again to $2164.65/ounce, closing at $2159.80/ounce, rising for the seventh trading day, bets on US monetary easing continue to increase, central bank buying and safe-haven demand to the gold market continue to be positive.

At the beginning of the Asian market on Friday (March 8), spot gold fluctuated narrowly, and is currently trading near 2159.41 US dollars/ounce. Gold prices continued to rise on Thursday, and spot gold once again refreshed its historical high to 2164.65 US dollars/ounce, closing at 2159.80 US dollars/ounce, rising for the seventh trading day. Supported by soft US economic data and Federal Reserve Chairperson Powell's dovish speech, central bank buying and safe-haven demand also brought continued positivity to the gold market...

Powell hinted on Wednesday that interest rates could be cut in the coming months if inflation eases, as rising bets on US monetary easing, central bank buying and safe-haven demand continued to give gold markets a boost.

"We are waiting to have more confidence that inflation will continue to fall back toward 2 percent," Mr. Powell said Thursday at a Senate Finance Committee hearing. "When we have that confidence, it will be appropriate to begin to scale back the level of policy restrictions so that we don't push the economy into recession. We are not far from that."

Marc Chandler, chief market strategist at Bannockburn Global Forex, said "Powell seems more dovish today than yesterday".

A surge in investor appetite for risky assets, including stocks, also weighed on the dollar, Chandler said.

On Thursday, the dollar index fell sharply, reaching a low of 102.80, a new low since January 24, closing at 102.83, down about 0.54%, for five consecutive trading days.

According to the Chicago Mercantile Exchange's Fedwatch tool, traders now see a 74.8% chance of the Federal Reserve cutting rates in June, compared with around 63% on February 29.

Bets on rate cuts are driving gold prices, and everyone is looking forward to a rate cut, said Joseph Cavatoni, market strategist at the World Gold Council. Cavatoni added that central bank buying of gold also continued to be strong.

Friday's U.S. nonfarm payrolls report is likely to provide further guidance to the market. According to interviews with economists, nonfarm payrolls are expected to increase by 200,000 last month after rising by 353,000 in January.

The labour market is easing steadily, which could ease some inflationary pressures and provide data support for the Federal Reserve to cut interest rates. Initial jobless claims held at a seasonally adjusted 217,000 for the week ending March 2, according to data from the labour department on Thursday. Economists expected 215,000, after the previous week's data was revised up from 215,000 to 217,000.

In addition, the data also showed that the number of people continuing to receive unemployment benefits rose by 8,000 in the week ended February 24 to 1.906 million, the highest level since November last year

In the physical market, soaring prices are expected to dampen spending during the Indian wedding season, but strong safe-haven demand is likely to emerge from China, the largest buyer.

James Steel, a precious metals analyst at HSBC, said geopolitical risks are also a major driver for gold.

Marcus Garvey, head of Macquarie's commodity strategy team, pointed out that slightly weaker U.S. data gave gold a reason to rise, but the volatility seemed excessive, possibly due to heavy futures buying that began on Friday.

Macquarie's Garvey said that if Friday's labor market data or next week's inflation data show any weakness, then $2,300 would be a short-term target based on technical levels, but that would be a fairly short-lived phenomenon, and then prices would correct and consolidate.

On Thursday, the European Central Bank decided to leave interest rates unchanged, with tough talk led by ECB President Christine Lagarde. While she prepared for possible policy changes, she ignored a possible rate cut at the April meeting, even though the June meeting looked likely.

WGC market strategist Joseph Cavatoni said that interest rate cut bets are driving gold prices higher, and everyone expects a rate cut to come. Cavatoni added that gold purchases by central banks also continue to be strong.

"We expect central banks to continue buying in the context of geopolitical uncertainty," said Jigar Pandit, head of commodities and currencies at Sharekhan, BNP Paribas. "A slowdown in large Asian economies will dampen global growth. So gold will remain a safe investment for banks in an uncertain financial environment."

In terms of the geopolitical situation, Hamas left Gaza ceasefire talks in Cairo on Thursday, days before Ramadan, with no progress, while the United States said it was Hamas's responsibility to reach an agreement on the Israeli hostage issue.

James Steel, precious metals analyst at HSBC, said geopolitical risk was also a major driver of gold prices. "We only have a small subset of assets that investors can really call a safe haven, and gold is number one."

Wayne Gordon, strategist at UBS Global Wealth Management, said: "On a fundamental basis, not everything is positive. Gold prices are clearly being driven by other factors." Despite the net outflows from gold ETFs, a number of other reasons have supported the rise in gold prices, including continued gold buying by central banks such as Asian powers and retail buying in countries such as India.

"We believe there have been more technical factors at work recently, with gold prices crossing key resistance levels," Mr. Gordon said. "The growing focus on the US Presidential Election, continued central bank buying and still relatively modest speculative positions suggest that gold's rally will continue further in the medium term, especially if ETF buying returns."