Gold Prices Edge Up as Geopolitical Risks Offset Stronger Dollar

Gold prices rose slightly on Friday despite a stronger US dollar and firmer treasury yields. Spot gold was trading near $4,055.00 an ounce, up 0.16% for the session. Silver, however, gained more ground, reaching $58.31 an ounce with a 1.35% increase.

The precious metals market steadied after Thursday's selloff, with traders weighing various factors including the US labor market, European Central Bank interest rates, and crude oil prices. The ECB kept its deposit rate unchanged at 2.25%, main refinancing rate at 2.40%, and marginal lending rate at 2.65%.

The initial jobless claims in the US fell to 187,000 for the week ended July 18, the lowest level since September 1969. This reinforced the view that layoffs remain historically low. The 10-year Treasury yield was near 4.70%, and the US dollar index, or DXY, was near 101.39.

Geopolitical risks continued to support gold, but elevated oil prices kept inflation risks higher, which in turn supported treasury yields. Market participants are now watching developments ahead of the July 29 Federal Reserve policy decision.