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Gold reaches new record highs after weak US job data

Gold prices reached new record highs after a weak U.S. employment report fueled hopes for a Federal Reserve rate cut. This gave bullion a fresh boost, fueling its blistering rally.

As of 12:34 GMT, spot gold was up by 0.9% to $3,577.33 an ounce. Prices have risen 3.7% this week and reached a new record of $3,582.71.

U.S. Gold Futures for December Delivery rose by 0.9% to $3.637.00.

Data revealed that the U.S. unemployment rate rose to 4.3% in August, while job growth in the U.S. slowed sharply. This confirms that the labor market is softening. The Federal Reserve should therefore cut interest rates this month.

Bullion is a safe investment, but it doesn't pay any interest.

China and India are the top two gold consumers. The physical demand for gold dropped in these hubs this week as a result of record-high prices.

The data on gold reserves for August, which is due from China's Central Bank on Sunday, won't match the record highs of September, but it may still give more insight into how high bullion price has affected demand.

Silver, among other metals rose 1% per ounce to $41.09 and is on track for its third consecutive weekly gain.

Palladium, which was up 0.2%, is now $1,125.44. Platinum rose 2.2%, to $1,396,97.

(source: Reuters)