Insights 
VT 
Key Points:
- Spot gold was steady at $3,328.36/oz after touching a low of $3,311.68.
- Bullion up 1.7% for the week, even as U.S. added 147,000 jobs in June.
- Trump’s tax bill and tariff implementation maintain safe-haven demand.
Gold prices held near $3,328 per ounce on Friday, little changed from the previous session, as traders absorbed mixed macro drivers. Bullion is on track for a 1.7% weekly gain, supported by heightened fiscal uncertainty and global tensions, even as robust U.S. employment data capped further upside.
President Trump’s sweeping tax and spending package cleared Congress on Thursday, triggering concerns about the trajectory of U.S. debt. The plan, while expansionary, threatens to erode healthcare coverage and strain federal budgets. Markets interpreted the bill’s passage as a potential inflationary driver and a longer-term threat to fiscal stability—factors that typically favour gold.
Jobs Report Strong, But Fed Cut Hopes Linger
U.S. firms added 147,000 jobs in June, beating expectations, while the unemployment rate fell unexpectedly to 4.1%. This strong labour market performance would typically weaken gold by bolstering the dollar and pushing yields higher. However, markets interpreted the data through a dovish lens, with Fed funds futures now pricing in a 50bps rate cut starting in October.
This suggests that while the Fed is less likely to act immediately, rate cuts are still on the table—especially if further data weaken or inflation remains muted. Low-rate environments are historically supportive of non-yielding assets like gold.
Technical Analysis
Gold (XAU/USD) experienced a steep intraday drop, plunging from 3365.76 to a low of 3311.68 before stabilising around 3328.43. The earlier bullish structure has broken down, with price now trading below the 5, 10, and 30-period moving averages. The recovery from the day’s low was shallow, suggesting limited bullish conviction.
Picture: Gold retreats below 3355 as Fed hawks weigh, as seen on the VT Markets app
The MACD histogram remains in negative territory, although the lines are beginning to converge—potentially hinting at a base forming, but not yet confirming a reversal. Resistance stands at 3355.96 (previous breakout zone), while immediate support lies near 3311. If that level is broken again, the door opens toward 3300.
Tariffs, Ukraine, and Global Risk Backdrop Keep Safe-Haven Demand Alive
Trump also announced that tariff rate letters would begin going out Friday, indicating a pivot from negotiations to enforcement. This revived concerns over global trade friction and its knock-on effects for economic growth.
On the global front, Trump’s phone call with Putin reportedly yielded no progress on the Ukraine conflict, keeping tensions elevated. Russia signalled it would “continue addressing root causes,” hinting at further delays in resolution. This backdrop keeps gold appealing as a hedge against both policy and conflict risks.
As long as global and fiscal uncertainty remain elevated, gold is likely to stay well supported—even amid better-than-expected economic data. Safe-haven flows may continue into the new week unless yields spike or Fed rhetoric shifts hawkish.
