While investors await a key U.S. labor market report later this week to gauge the trajectory of interest rates, gold extended gains on Monday as the dollar weakened, trading just above the $5,000 per ounce level.
Spot gold rose 1.3% to $5,026.04 an ounce by 0333 GMT, after rising 4% on Friday. U.S. gold futures for April delivery rose 1.4% to $5,046.10 an ounce.
Tim Waterer, Principal Analyst at KCM, said: “Gold is generally up today, although it’s a cautious development this week with major employment data coming out, helped by a weaker dollar. Bargain hunters are pushing gold above the $5,000 level.”
The US dollar is at its lowest level since February 4, making greenback-priced metals cheaper for overseas buyers.
San Francisco Fed President Mary Daly said Friday that she thinks one or two more rate cuts may be necessary to combat weakness in the labor market.
Investors are expecting at least two 25 basis point rate cuts in 2026, with the first rate cut expected to occur in June. Non-yielding bullion tends to do well in low interest rate environments.
“A weak jobs report could help gold’s recovery efforts. We don’t expect the Fed to cut rates until mid-year unless the jobs numbers really start to fall off a cliff,” Waterer said.
Investors were awaiting Wednesday’s release of U.S. nonfarm payrolls data for further clues about the Fed’s monetary policy direction. The report was delayed from last week as the four-day partial government shutdown ended.
Foreign Minister Abbas Arakchi said on Sunday that recognizing Iran’s right to enrich uranium is key to successful nuclear negotiations with the United States. U.S. and Iranian diplomats held indirect talks in Oman on Friday aimed at reviving diplomacy amid a U.S. naval buildup near Iran.
Spot silver rose 4.3% to $81.11 an ounce after rising nearly 10% in the previous session. It hit an all-time high of $121.64 on January 29th.
Spot platinum fell 0.2% to $2,091.54 an ounce, while palladium rose 1% to $1,723.37. (Reporting by Ishaan Arora in Bengaluru; Editing by Subransh Sahu)
