Gold rebounds past $4,400 as rate-hike odds cool ahead of NFP

Gold has climbed back above the $4,400 handle, extending its rebound from Wednesday's three-week low, after soft ADP jobs data and dovish Federal Reserve commentary cooled market expectations of a September rate hike. Markets now price roughly a 58% chance of a 25-basis-point hike at the September 15 ~ 16 FOMC meeting, down from close to 70% earlier this week. With the August US nonfarm payrolls report due on Friday, XAU/USD was trading near $4,436 at press time, up about 1.1% on the day.

Gold is on track for a second straight session of gains. On Wednesday, the metal first slid to a three-week low of $4,282.45 in the Asian session, extending a four-day losing streak sparked by Fed Chair Kevin Warsh's hawkish Jackson Hole speech on August 28, before rebounding about 1% to close near $4,388. On Thursday, buyers defended the $4,400 level again and spot prices pushed to a session high near $4,443, with the day's range holding between $4,381 and $4,443 so far.

Zooming out, gold is still consolidating after a volatile first eight months of 2026: the metal printed an all-time high above $5,600 earlier this year, corrected below $4,000, then clawed back above $4,600 in mid-to-late August, when it formed a double top near $4,755. At current levels, it sits roughly 21% below the record high — the middle of a "post-record pullback" phase, with August still closing up about 10%.

A cooler labour market. US companies added only 38,000 jobs in August, according to Wednesday's ADP report, well short of the 47,000 expected. The softer pace of hiring tempered expectations of aggressive Fed tightening that had built after Warsh's hawkish remarks and a warning from Fed Governor Michael Barr that policymakers should be ready to hike if inflation fails to ease.

Dovish Fed voices. New York Fed President John Williams said on Thursday there is evidence US inflation is continuing to ease as the impact of tariffs fades, adding that higher energy prices are not spreading into other services. Fed funds futures responded by trimming the odds of a hike at the September 15 ~ 16 meeting to about 58%, down from roughly 70% at Wednesday's peak.

A calmer oil market. President Donald Trump's comments that the latest US strikes on Iran would likely be short lived slowed oil's recent surge, easing the energy-driven inflation scare that had pressured bullion. Brent is trading near $95 and WTI just below $91 — elevated on Strait of Hormuz risk after renewed US-Iran fighting, but off their worst levels.

A weaker dollar. The greenback slipped as the Japanese yen jumped more than 1% against it (USD/JPY near 156.6), with intervention watch and strong Bank of Japan rate-hike expectations for its September 17 ~ 18 meeting back in focus. Treasury yields, which had spiked to ~4.82% on the 10-year earlier in the week amid a global bond selloff, also eased, removing a key headwind for non-yielding bullion.

ING reminds that gold will remain sensitive to US inflation and jobs data in the near term: central-bank buying and geopolitical risk underpin the downside, but a stronger dollar and higher-for-longer rate expectations will cap the upside — until Fed policy turns less restrictive, any rally is likely to be shallow.

Chart-driven analysts are similarly cautious. Investing.com technical commentary notes gold broke below its major moving averages on the daily and 4-hour time frames during the slide, and sellers turned cautious only after the weak ADP print. A reclaim of the $4,489 ~ $4,581 resistance cluster would be needed to repair the short-term structure.

Long-term bulls see the correction as noise. Crescat Capital founder Kevin Smith told Kitco that the Fed is "effectively unable to fight and control inflation", arguing fiscal imbalances have pushed the US into a "fiscal dominance" era in which Fed policy increasingly serves debt management. Crescat keeps a $20,000 per ounce long-term target, modelling global M2 money supply growth of roughly 7% a year — about four years out — with central-bank gold buying of roughly 1,000 tonnes a year underpinning the path.

On the daily chart, XAU/USD has reclaimed the 20-day moving average ($4,397) and the 100-day moving average ($4,426) after Thursday's bounce, though the 200-day MA ($4,528) still caps upside. Momentum has improved from the oversold extremes seen during the slide (the 4-hour RSI dipped near 28 before the rebound) but is not yet decisively bullish.

If gold holds above $4,400, the immediate targets are the $4,443 session high, then the $4,489 resistance cluster (SuperTrend and prior support-turned-resistance); a break above that opens the 200-day MA at $4,528 and, beyond it, $4,581 — with the $4,755 August double top as the ultimate bull objective. If $4,400 gives way, support sits at the $4,381 day low, then the $4,355 ~ $4,300 zone (the 50% Fibonacci retracement area where the selling stalled), before Wednesday's $4,282.45 low becomes the last line of defence ahead of a deeper correction.

The week's key event is the US nonfarm payrolls report at 08:30 ET on Friday. After the soft ADP number, a weak official payrolls print — especially alongside a soft unemployment rate or average hourly earnings — would further unwind September rate-hike bets and give gold a clear run at $4,489 and the 200-day MA near $4,528. A strong report, by contrast, would cement the case for a hike at the September 15 ~ 16 FOMC meeting and risk dragging gold back toward $4,300 and the $4,282.45 low. Until the data lands, expect continued two-sided churning between $4,400 and $4,450 — and wait for a clear break before positioning.

Related reads: for the full breakdown of Wednesday's drop below $4,300, see Will gold keep falling after dropping below $4,300?; to understand how the US dollar is driving metals this week, check out our DXY forecast as Fed bets and Iran risks collide.