Gold Stuck in Range as US-Iran Diplomacy and Labor Data Weigh

Gold prices remain steady at around $4,000 as investors weigh the uncertainty of US-Iran diplomacy against the possibility of strong American employment numbers. The Federal Reserve's policy on interest rates is a key factor in gold prices, and any indication that employment is cooling could lead to lower yields and a stronger bullion market.

Geopolitical tension has supported demand for defensive assets like gold, but higher energy costs and expectations of another US rate increase have threatened to lift bond yields and reduce its appeal. A credible peace process between the US and Iran could support gold prices if it leads to cheaper energy and reduced inflation fears.

Traders assign a 65% probability to a September rate increase, and labor-market weakness could pressure the dollar and lift gold. However, strong data would reinforce the opposite trade by supporting the dollar and Treasury yields.

The World Gold Council's annual survey found that 89% of responding reserve managers expect global central-bank holdings to increase during the next year, with a record 45% expecting their own institutions to add gold.