Spot gold extends gains after U.S. payroll report, last up 1.6% to $4,094.45 an ounce

Gold climbed on Thursday, ​bolstered by soft jobs data, ​weaker oil and ​comments from the Federal Reserve chair that suggested inflation risks have eased, ahead of U.S. nonfarm payrolls data.

Spot gold was up 1.6% at $4,094.45 an ounce, ⁠after ‌touching its highest level since June 23 ⁠in the previous session. The metal snapped a two-day losing streak to close higher at $4,029.89 on Wednesday after U.S. private payrolls data for June.

“The precious metal ‌is rebounding today after Fed Chair (Kevin) Warsh struck a less hawkish tone at the ECB forum,” said Nikos Tzabouras, senior market analyst ​at Tradu.com.

Warsh said on Wednesday that inflation expectations and risks had eased in recent weeks, while reiterating the Fed’s commitment to returning inflation to its 2% target, warning against expectations of looser policy.

Traders see a 63% ⁠chance of a rate hike by September, per the CME FedWatch tool.

Higher interest rates raise ‌the opportunity cost of holding non-yielding assets like gold.

The U.S. economy saw job creation cool sharply heading into the summer, the Bureau of Labor Statistics reported Thursday.

Nonfarm payrolls for June increased by a seasonally adjusted 57,000 for the month, slower than the downwardly revised 129,000 added in May and worse than the 115,000 Dow Jones consensus forecast.

Weakness in the ⁠data could help gold inch towards $4,250, but it’s not going ⁠to be enough to take it out of bear territory, said Tzabouras.

“Anything above 100,000 jobs would likely be sufficient to sustain Fed hike ​expectations and keep bullion vulnerable to deeper ‌declines toward $3,500.”

Meanwhile, oil fell for a third consecutive day after Qatar said Iran and the U.S. had made progress in indirect talks focusing on the Strait of Hormuz.

Lower oil prices temper inflation worries, boosting bets that the Fed could adopt a less restrictive ​policy stance.

Among other metals, Spot silver rose 1.8% to $60.21 per ounce, platinum gained 2.6% to $1,617.10, and palladium added 2.1% to $1,234.86.