Gold prices climbed above $4,350 per ounce on Friday, their highest level in two months, as easing energy costs and signs of a cooling labor market reduced expectations of a Federal Reserve rate hike this year. The US economy unexpectedly shed jobs in July, while both wages and the labor force participation rate declined, undermining the view that labor market strength was fueling inflation.
At the same time, energy prices gave back some of their recent gains despite persistent uncertainty over a potential agreement between Iran and the United States to resume exports through the Strait of Hormuz. In response, Treasury yields edged lower, supporting bullion by reducing the opportunity cost of holding non–interest-bearing assets.
Meanwhile, data from clearing institutions showed that institutional investors in China continued to increase long positions in gold-backed assets. This move reflects a search for safety amid volatility in technology stocks and growing signs of resilience in the physical gold market, which has recently been reinforced by central bank demand.
