Gold prices rose on Friday, poised for weekly gains, as weaker-than-expected U.S. economic data overshadowed initial optimism following a phone call between U.S. President Donald Trump and Chinese President Xi Jinping. Investors also awaited key U.S. payroll data due later in the day.
Spot gold rose 0.3% to $3,363.33 per ounce by 0548 GMT, marking a 2.3% increase for the week. U.S. gold futures also climbed, up 0.4% at $3,387.
Trump and Xi held a rare direct call on Thursday to discuss escalating trade tensions and disputes over critical minerals. However, despite initial market optimism, key issues between the two countries remain unresolved. Tim Waterer, Chief Market Analyst at KCM Trade, noted, “Some of the initial enthusiasm for risk appetite following the Trump-Xi call has started to wear off, which has enabled gold to creep higher.”
A report showing an increase in U.S. jobless claims to a seven-month high last week contributed to the market’s cautious sentiment. Investors are now focused on the upcoming U.S. nonfarm payroll data, set for release at 1230 GMT. This follows a series of reports suggesting softness in the labor market.
Economists polled by Reuters forecast that 130,000 jobs were added in May, while the unemployment rate is expected to remain unchanged at 4.2%. Waterer added, “The upcoming NFP release could be the catalyst for a breakout should the data produce a significant miss on either side of expectations.”
Despite the ongoing economic uncertainty, Federal Reserve policymakers have indicated that inflation concerns are likely to delay any shifts in monetary policy, suggesting a prolonged pause in rate hikes.
Gold, traditionally seen as a safe-haven asset, has performed well amid economic uncertainty and in low-interest-rate environments. However, elevated prices this week dampened physical demand, especially in major Asian markets. In India, gold discounts surged to their highest levels in over a month, indicating weaker buying interest.
On the broader metals front, spot silver fell 0.7% to $35.92 per ounce, though it remained near a 13-year high. Platinum gained 1.7%, rising to $1,149.85, while palladium saw a 0.7% increase, reaching $1,012.60. All three metals are on track for weekly gains.
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