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Asset Watch
Tuesday, 12 August 2025
Gold prices rose following the release of the US July jobs report, which showed a significant slowdown in labour market performance. The weak data fuelled expectations that the Federal Reserve will cut interest rates by 25 basis points at its September meeting, with the possibility of a cumulative reduction exceeding 50 basis points this year.
The rally extended amid reports that the US administration might impose tariffs on gold imports, after previously levying a 39% tariff on Swiss goods (Switzerland being one of the world’s largest gold exporters). However, prices retreated in yesterday’s session after President Trump confirmed there would be no tariffs on gold.
Market sentiment improved after news that the US and China agreed to extend their trade truce for 90 days, until November 10, allowing more time for negotiations. During this period, existing tariffs will remain in place (30% on Chinese goods and 10% on US goods). A potential breakthrough could emerge when the two presidents meet in October.
Gold also faced downward pressure after reports that the US and Russian presidents will meet in Alaska later this month, possibly paving the way for a Russia–Ukraine truce and the beginning of an end to the conflict.
Investors now await the US Consumer Price Index report release today. The YoY Core CPI (excluding food and energy) is expected to rise from 2.9% in June to 3.0% in July, while the YoY headline CPI could edge up from 2.7% to 2.8%. If data meets expectations, the Fed is likely to proceed with a 25-basis-point cut in September (an outcome markets currently price with an 85% probability) potentially supporting gold prices further.
Last week, gold failed to break above the rising trendline from the January 20 low, signalling insufficient bullish momentum. Prices could be on the way toward the low end of the current trading zone located between $3,357 and $3,245.
Bearish scenario: A daily close below $3,245 suggests a possible downward move toward $3,127. That said, the support level at $3,167 should be considered.
Bullish scenario: A daily close above $3,357 signals a continuation of sideways trading, opening the door for a move toward the April 22 high at $3,500. In this case, the resistance level at the June 16 high of $3,451 should be closely watched.
Chart Source: ADSS Platform
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