Gold prices rose over 1% on Thursday, coinciding with a dip in the US dollar and discouraging private payroll data for the month of May.

Spot gold was up 1.3% to $1,869.67 per ounce by 12:20 p.m. ET, its highest in nearly a month. US gold futures also gained 1.3%, trading at $1,873.30 per ounce in New York.

[Click here for an interactive chart of gold prices]

Meanwhile, the US dollar index fell by 0.5%, slipping off a one-week high reached during Wednesday’s session.

The latest data from payroll processing firm ADP showed that job creation at companies decelerated to the slowest pace of the pandemic-era recovery in May.

Private sector employment rose by 128,000 for the month, falling well short of the 299,000 Dow Jones estimate, and a decline from the downwardly revised 202,000 in April.

“(The job data) is really raising the recession concerns that have been brewing in the market and supporting gold,” Ryan McKay, commodity strategist at TD Securities, told Reuters.

“A portion of the investors and traders are starting to question whether the Federal Reserve will really be willing to be as hawkish as has been anticipated,” he added.

Fed Vice Chair Lael Brainard on Thursday said she is backing at least a couple more half-point interest rate hikes, with more on tap if price pressures fail to cool.

Investors will now keep a close eye out on Friday’s nonfarm payrolls data, which is expected to show strong job growth continued in May.

(With files from Reuters)