Gold raced to a six-month high yesterday, heading toward $ 1,730 per ounce, after US jobs growth slowed more than expected in August, possibly paving the way for the Federal Reserve to announce additional stimulus for its sluggish economy.

Gold bulls went on the offensive after the numbers showed nonfarm payrolls increased only 96,000 last month, below expectations for a 125,000 rise.

The report’s weak tenor was underscored by revisions to June and July data to show 41,000 fewer jobs created than previously reported.

Spot gold rose almost 2 percent as the dollar weakened, hitting $ 1,733.81 per ounce, its strongest since late February.

US gold futures also jumped almost 2 percent to a session high of $ 1,736.90.

“Gold is going through the roof because this negative data makes QE3 more likely now,” Daniel Briesemann, commodities analyst at Commerzbank in Frankfurt, told Reuters.

“There is a chance that Bernanke will announce QE3 already next week, that means pumping more money into the market so gold becomes a more attractive investment due to inflation fears.”

The market had seen giddy price action on Thursday, rushing to its loftiest since early March after the European Central Bank unveiled a new and potentially unlimited bond purchase plan to lower borrowing costs of debt-laden nations, in the latest effort to fight the euro zone debt crisis.

Central bank cash printing raises the inflation outlook and adds to gold’s attraction as a hedge against rising prices.

In Asia’s physical market, dealers continued to report scrap flow as prices remained near $ 1,700 per ounce.

Platinum also gained traction to $ 1,596.7, its highest since mid-April, with focus still on dominant producer South Africa.