Gold Rallies Amid Weaker Oil Prices and Hopes of Middle East Peace

Gold prices are on track for their biggest weekly gain since January, driven by weaker oil prices and hopes of peace in the Middle East. Spot gold was up 0.4% at $4,254.11 per ounce, after hitting a seven-week high in the previous session.

The price surge comes as investors await key US nonfarm payrolls data for clues on the interest rate outlook. The Federal Reserve is expected to release its decision on rates later this month, with traders currently seeing a 55% chance of a US rate hike in September.

Gold's appeal as an inflation hedge has been boosted by lower energy prices and reduced expectations of higher-for-longer interest rates. Analyst Matt Simpson said $4,000 had proven to be a solid support level for gold, and bulls are waiting for dips to take advantage of a rally towards $4,600.