Gold prices were little changed on Friday but remained on track for their strongest weekly performance since January, supported by falling oil prices, as investors awaited the release of the U.S. nonfarm payrolls report for clues about the outlook for interest rates.
As of 00:45 GMT, spot gold was virtually unchanged at $4,235.57 per ounce, while posting a 4.8% gain for the week. U.S. gold futures slipped 0.1% to $4,293.80 per ounce.
Market sentiment was also influenced by comments from U.S. President Donald Trump, who said he believes the conflict involving Iran will end “very soon”, adding that Iran cannot continue under current conditions.
Trump also indicated that the U.S. armed forces are experiencing shortages of certain weapons supplies.
Meanwhile, oil prices were on course for a weekly decline. Lower energy prices have eased inflation concerns and reduced expectations that interest rates will remain elevated for an extended period.
Gold is widely regarded as a hedge against inflation, although higher interest rates generally reduce its appeal because the metal does not generate yield.
Investors are now focused on the U.S. Labor Department’s July employment report, scheduled for release at 12:30 GMT.
According to the CME FedWatch Tool, traders currently see a 55% probability of a U.S. interest rate increase in September.
The U.S. Federal Reserve kept its benchmark interest rate unchanged at a target range of 3.50% to 3.75% on July 29, despite inflation remaining well above its 2% target.
Economic data released on Thursday showed that initial U.S. jobless claims edged up slightly last week, while layoffs fell to their lowest level in two years during July, indicating that the labor market remains relatively resilient.
Among other precious metals:
* Spot silver fell 0.4% to $61.26 per ounce.
* Platinum declined 0.5% to $1,720.75 per ounce.
* Palladium dropped 0.5% to $1,363.50 per ounce.
Source: Reuters
