Gold Trading Bullish After US Services Sector Grows at Slowest Pace in Three Years
Ahead of the US NFP report releasing today, gold is trading bullish on the back of a weaker than expected ISM non-manufacturing report for September. At the time of writing, GOLD is trading at a little above $1,509.
The safe haven appeal of gold was boosted after the ISM non-manufacturing index declined sharply to 52.6 in September from 56.4 in August and 55.3 expected. This drove a weakness in the US dollar, increasing the attractivness of holding gold, and giving yet another boost to the yellow metal.
The US-China trade war came back into focus over a weakness in both manufacturing and service sectors in the US. The services sector in the US grew at the slowest pace seen since three years.
Gold is also trading higher as markets expect recent weak economic data to convince the Fed to cut interest rates once again to support the weakening US economy. On Thursday, two policymakers from the Federal Reserve hinted at future rate cuts. Lower interest rates will weaken the dollar further and further boost gold’s appeal in financial markets.
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