Gold prices were poised to post their second consecutive weekly gain on Friday, boosted by demand for safe-haven assets amid tensions in the Middle East and growing bets that the U.S. Federal Reserve will cut interest rates later in the year.
Spot gold was up 0.1% at $2,360.95 per ounce at 0344 GMT, after hitting a two-week high in the previous session. The metal has gained more than 1% so far for the week.
U.S. gold futures rose 0.2% to $2,374.60.
“From a short-term perspective, gold’s current bullish movement is primarily driven by rising geopolitical tensions, especially after news of the attack on Gaza,” said Kelvin Wong, senior market analyst for Asia -Pacific at OANDA.
On Thursday, several Israeli airstrikes in the Gaza Strip killed at least 14 people and injured dozens more.
“The market is now looking for the possibility of another rate cut after September, which could support gold, keeping it above the $2,300 level,” Wong added.
Data on Thursday showed that initial U.S. jobless claims fell moderately last week, while new housing construction fell. This, combined with tepid retail sales last month, means a US rate cut in September remains on the table.
Lower interest rates reduce the opportunity cost of holding unprofitable bullion.
The market’s next focus is on the flash US Purchasing Managers’ Indexes, due at 0145 GMT.
“While corrections are possible, the support level around $2,300 remains crucial for gold, with any significant decline likely influenced by changes in economic indicators or sudden market movements,” said Luca Santos, analyst at ACY Securities .
Spot silver fell 0.4% to $30.60 an ounce, platinum rose 0.4% to $982.45 and palladium gained 0.8% to $930.98. All three metals are headed for weekly gains.
