With the likelihood of a US Fed rate hike once again receding following latest US data on jobs that indicated a drop in the rate of hiring to levels last seen in August 2014, gold prices rebounded to reach new three-week highs of US$ 1,266 per troy ounce.

Yesterday’s jump of about 1.5% in international gold prices followed two consecutive reports from the US Labor Department that make the chances of a Fed rate hike extremely unlikely in the near term.

The first indicated that the US added 38,000 jobs in May, the lowest number of monthly jobs added in nearly six years. A subsequent survey also indicated that the rate of hiring fell to 3.5% in April which was the lowest recorded in nearly two years.

Earlier this week, while addressing a meeting of the World Affairs Council, Federal Reserve chair Janet Yellen refrained from any direct mention of a rate hike, though she downplayed the reports, while emphasising positives such as the fact that average hourly earnings in the U.S. have increased 2.5% over the last 12 months.

Yellen was quoted as saying that "If incoming data are consistent with labor market conditions strengthening and inflation making progress toward our 2 percent objective as I expect, further gradual increases in the Federal Funds Rate are likely to be appropriate."

This was interpreted as meaning that a hike was not imminent, resulting in an immediate spurt in investor interest. This repeated deferment of a further Fed hike after it raised rates in December2015, the first time it had done so since the 2008-09 crisis, has ensured that gold has risen nearly 19% since the start of the year.

Silver prices also rose by nearly 1% to touch US$ 17.1 per troy ounce.