Gold Edges Up as Brent Crude Retreats, Fed Decision Looms

Gold prices edged up on Friday as Brent crude oil retreated from above $100 a barrel. The precious metal has fallen about 23% since the US-Iran conflict began in late February, pressured by expectations of war-driven inflation keeping interest rates higher for longer.

The US Federal Reserve's policy meeting outcome next week is expected to keep rates unchanged, but traders are pricing in an 82% chance of a US rate hike in September. Analysts at ING said recent strength in bullion appears driven largely by dip-buying and short covering.

Tai Wong, an independent metals trader, noted that 'gold feels ready to move back higher' if the Fed holds interest rates steady next week. Spot gold was up 0.1% at $4,052.78 per ounce, while US gold futures for August delivery settled 0.5% higher at $4,070.80.