Market expectations for a Federal Reserve interest rate increase in September plummeted to 40% following recent economic data. This represents a sharp decline from just days ago, when investors priced in a 70% or greater probability of a hike.
The shift follows an unexpected contraction in the labor market, marking the third-largest monthly decline in employment since the 2020 pandemic. In response to the cooling economic outlook and shifting monetary policy expectations, gold prices climbed past the $4,400 per ounce threshold.