**Gold Futures Surge Amid Tariff Concerns** US tariffs now affect 1-kg and 100-oz Gold bars, mostly refined in Switzerland, impacting large US exports. The US Dollar Index is over 98.00, with the 10-year Treasury yield at 4.25% and the 30-year yield at 4.82%. Labor data in the US points to possible rate cuts from the Fed. Initial Jobless Claims are at 226K, and Nonfarm Payrolls show 73K new jobs. Fed comments and a Trump nomination create uncertainty. Raphael Bostic sees a potential for rate cuts but wants more data before making a final decision. Globally, stocks are expected to gain this week. The STOXX 50 is up 3.3%, and the FTSE 100 looks positive. In the US, stocks have also risen, with the Dow Jones up 1% and Nasdaq gaining 3%. Gold’s price responds to geopolitical events, the strength of the US Dollar, and interest rates, while major purchases by central banks keep demand strong. **Federal Reserve Focus** Gold often moves in the opposite direction of the US Dollar and Treasuries. Geopolitical issues or fears of recession can raise its price. Investors turn to gold as protection against inflation and currency drop. Gold is trying to stay above the $3,400 level, a key point for investors. The market feels torn between favorable factors, like new US tariffs and weak labor reports, and unfavorable ones, like a strong dollar and rising stock prices. This tug-of-war suggests that prices may change erratically soon. The Federal Reserve is in the spotlight. The low 73K jobs added in July 2025 heighten the pressure for a rate cut. Market data supports this view, showing a 72% chance of a rate cut at the September 2025 meeting, according to the CME FedWatch tool. We believe this expectation will help keep gold from facing a significant sell-off before that decision. In the coming weeks, options traders might want to try strategies that take advantage of rising volatility. The Gold Volatility Index (GVZ) has risen to 18.5. Buying straddles or strangles could be a smart way to navigate the uncertainty around the Fed’s next move. These strategies could profit if gold shifts significantly in either direction, which seems probable. For those optimistic about gold, buying call options that expire after the September Fed meeting might be wise. Recall how gold surged during the Fed’s policy change in 2019 when concerns about slowing growth led to rate cuts. Central banks continue to support gold, adding 250 metric tons to their reserves, according to the World Gold Council data for the second quarter of 2025. Create your live VT Markets account and start trading now.

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