Gold gains as investors anticipate super-sized Fed rate cut

Gold prices rose to near one-week highs on Thursday, on the back of a weaker U.S. dollar and lower yields after signs of labour market losing steam led investors to expect a super-sized rate cut from the Federal Reserve this month.

Spot gold was up 0.6% to $2,509.63 per ounce by 12:23 p.m. ET (1623 GMT), rising as much as 1.1% earlier in the session but prices slightly pared gains after U.S. services sectorbdata.

U.S. gold futures rose 0.6% to $2,540.10.

U.S. private employers hired the fewest number of workers in 3-1/2-years in August, potentially hinting at a sharp labour market slowdown. This follows data on Wednesday showing a sharp decline in U.S. job openings in July.

After ADP data, there was a gold spike and it really shows "the labour market is in dire state and there is a lot of concern about it," said Phillip Streible, chief market strategist at Blue Line Futures.

"The initial claims data didn't really help either as far as painting a rosy picture for the employment."

Elsewhere, spot silver gained 1.7% to $28.78, platinum climbed 3% to $930.70 and palladium rose 1% to $943.00.

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