Gold Holds Steady Amid Middle East Tensions and US Jobs Data
Gold prices remained steady on Tuesday as investors watched for signs of US-Iran talks and waited for key US jobs data to give clues about the Federal Reserve's interest-rate path.
The conflict in the Middle East has driven up energy costs and stoked inflation fears, which could prompt central banks to increase interest rates. However, higher rates tend to weigh on gold since it yields no interest.
According to current market expectations, there is a 65% chance that the Fed will raise rates in September. Federal Reserve Bank of New York President John Williams stated that he remains optimistic about easing inflation pressures, but if they don't ease gradually, the US central bank will not hesitate to respond with rate hikes.
US jobs data is set to be released throughout the week, including US job opening data on Tuesday, the ADP employment report on Wednesday, and nonfarm payrolls figures on Friday. The labor market reports are expected to provide insight into the Fed's interest-rate decision.