Gold fell sharply on Friday after US jobs data came in much stronger than expected, reviving uncertainty about what the Federal Reserve will do at its September meeting.
The US economy added 162,000 jobs in August. Economists had expected around 53,000. The unemployment rate held at 4.1%. The data showed a clear rebound from July, when payrolls were reported as falling by 23,000.
BREAKING: The US economy adds +162,000 jobs in August, well above expectations of +55,000.
The unemployment rate was 4.1%, in-line with expectations of 4.1%.
July's job number was also revised up by +43,000 jobs and is now positive for the month.
The US job market nearly…
— The Kobeissi Letter (@KobeissiLetter) September 4, 2026
Gold spot prices dropped around 2% to $4,391.61 an ounce. Gold futures fell 0.6% to $4,514.19. Silver also fell 1.5%, while platinum dropped 0.6%.
The US Dollar Index edged up 0.2% to 99.03 following the report. A stronger dollar makes gold more expensive for buyers using other currencies, which tends to weigh on prices.
Fed Governor Christopher Waller said Thursday he would support keeping rates steady at the September 15-16 meeting if incoming inflation data confirm that price pressures are continuing to ease.
Waller did not rule out a hike entirely. He said August inflation figures would heavily influence his decision and that a return of price pressures could still push him toward a rate increase.
Markets reacted quickly. The probability of a September hike fell to around 50%, down from roughly 70% earlier in the week, according to the CME FedWatch tool.
Fed rate-hike odds for September are now slightly favored, climbing to 52% after the stronger-than-expected jobs report. https://t.co/WBWgYyx5AV pic.twitter.com/TGijsM22kk
— Wall St Engine (@wallstengine) September 4, 2026
Lower interest rates tend to support gold because bullion does not pay interest, making it more attractive when yields on other assets fall.
Gold had already rebounded nearly 2% on Thursday, snapping a three-session losing streak. Friday’s jobs data capped some of that recovery.
The August consumer price index report, due next week, is now seen as a key factor in the Fed’s final decision. Analysts say it could matter more than the jobs report for determining whether policymakers hike or hold.
Wage growth in Friday’s report remained relatively contained, which gave gold some support and limited further selling.
Senior market analyst Tony Sycamore at IG noted that gold’s recent gains also came as pressure from energy prices and Treasury yields eased. He said the latest flare-up in the Middle East may have peaked, reducing the inflation concerns tied to higher oil prices.
Gold remains above the $3,942 low reached in late June. Sycamore said that level supports a view that gold has formed a medium-term base.
Gold now faces technical resistance near the 200-day moving average around $4,526. A break above that level would improve the short-term outlook. Failure to hold above it could lead to another pullback.
The next major test for gold will be next week’s inflation data.
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