Dollar Loses Steam, Will Gold Reach $4,300?
Gold prices strengthened again on Friday (July 3rd), approaching the US$4,200 per troy ounce area. This increase marked the third consecutive day of gains after gold previously fell to its lowest level since November 2025.
Gold's gains occurred as the market cut expectations for a Federal Reserve interest rate hike. US Non-Farm Payrolls data showed the economy added only 57,000 jobs in June, well below market expectations of 110,000. The previous month's data was also revised down from 172,000 to 129,000.
Although the unemployment rate fell slightly to 4.2%, the labor data still indicated a slowdown in the US labor market. This condition led the market to believe that the Fed was under less pressure to raise interest rates again aggressively. Market expectations shifted from the chance of one to two rate hikes in 2026 to zero to one hike.
Pressure on the US dollar also strengthened gold's rise. The dollar hovered near a two-week low after weak jobs data and easing inflation concerns stemming from falling oil prices. When the dollar weakens, gold becomes more attractive to investors because it makes it cheaper for buyers using other currencies.
However, gold's gains could still be restrained by geopolitical risks. Uncertainty surrounding US-Iran talks remains a concern after reports emerged that US officials fear Israel could disrupt the peace negotiations. Iran has also warned of a swift response to any US interference in the Strait of Hormuz.
Trading volume is expected to be thin today as US stock and bond markets are closed for the Independence Day holiday. Nevertheless, the underlying sentiment remains positive for gold. If buying momentum continues, gold could test the US$4,200 to US$4,220 area, while corrections are likely to be contained around US$4,150 to US$4,130. (asd)*
Source: Newsmaker.id
