Gold Edges Higher Amid Mixed Signals on US-Iran Talks

Gold prices edged higher on Tuesday as investors weighed mixed signals on potential US-Iran talks and awaited key US labor market reports for clues on the Federal Reserve's interest-rate trajectory.

Sport gold rose 0.2% to $4,059.81 per ounce by 0257 GMT, with investors looking ahead to reports on the US labor market, including job opening data later in the day, the ADP employment report on Wednesday and nonfarm payrolls figures on Friday.

Ajay Kedia, director at Mumbai-based Kedia Commodities, said 'Gold is currently in a consolidation phase. If we see weakness in the job market, it could pressure the US dollar and as result there will be gains in gold.'

The conflict between the US and Iran has driven up energy costs and stoked inflation fears, which could prompt central banks to raise interest rates.

However, higher rates tend to weigh on gold prices since it yields no interest. Traders currently price in a 65% chance of a rate increase in September after a divided Fed maintained the status quo at its last policy meeting.