Gold surges to £3,221 an ounce as US jobs weakness fuels rate cut bets

Gold climbed to £3,221.30 per troy ounce at the end of the week, posting its strongest five days in months as US employment data fell sharply short of forecasts. Nonfarm payrolls contracted by 23,000 in July, well below the consensus expectation of 80,000 jobs gained, and traders rapidly repriced the odds of a Federal Reserve rate cut from current levels.

A weaker dollar follows when rate cut expectations rise, because lower interest rates make dollar-denominated assets less attractive internationally. Since gold prices globally in US dollars, a softer greenback translates directly to cheaper bullion for pound sterling buyers. The move lower in US Treasury yields reinforced this: as inflation-protected bond yields fall, gold's appeal as a non-yielding safe-haven asset improves relative to cash and fixed income.

Silver also benefited from the same USD and yield headwinds, gaining alongside gold as traders repositioned for lower rates ahead. For UK investors considering purchase or storage of bullion, remember that the £3,221 spot price is just the starting point. Your actual cost includes dealer premium, delivery fees, and any applicable VAT. This is not financial advice.