Gold Shines Again Amid Oil Plunges
Gold prices strengthened during Monday's trading (Aug 3) following a weakening US dollar and a sharp drop in oil prices. Spot gold rose 0.4% to around US$4,055.36 per troy ounce, while US gold futures gained 0.2% to reach US$4,054.20.
Positive sentiment emerged after US President Donald Trump postponed a new strike against Iran, opting instead to pursue a diplomatic agreement. Talks were scheduled for Monday, focusing on Iran's nuclear program and the reopening of the Strait of Hormuz.
This optimism caused oil prices to fall by more than US$4 per barrel. The drop in energy costs helped alleviate inflation concerns and reduced expectations that the Federal Reserve would need to maintain or raise interest rates for an extended period.
Gold was also supported by a weakening dollar—hitting its lowest level since mid-June—and a decline in 10-year US Treasury yields. A weaker dollar and lower yields typically enhance the appeal of gold, which does not bear interest.
Markets are now awaiting US labor data, including ADP and Nonfarm Payrolls figures. Weak employment data could strengthen the likelihood of the Fed holding interest rates steady, paving the way for further gains in gold prices.
Newsmaker Analysis: Gold sentiment remains positive as long as oil prices, the dollar, and US yields remain weak. However, hawkish comments from Fed officials could cap gains. The US$4,050 level serves as key support, while the US$4,080–US$4,100 range represents the next hurdle.
Source: Newsmaker.id
