Gold (XAU/USD) recovers part of its earlier losses on Friday as traders reposition ahead of the US Nonfarm Payrolls (NFP) report, due at 12:30 GMT.
At the time of writing, XAU/USD is trading around $4,462 after hitting an intraday low of $4,428
Economists expect the US economy to have added 85K jobs in May, down from 115K in April, while the Unemployment Rate is forecast to remain unchanged at 4.3%. The data could provide the catalyst for Gold to break out of the narrow range it has traded in since mid-May. However, geopolitical tensions in the Middle East continue to exert influence on the precious metal’s fortunes.
Gold has behaved more like a risk-sensitive asset since the US-Iran war began in late February, falling whenever geopolitical tensions escalate and rebounding whenever hopes of a peace deal gain traction. The metal is still down about 17% from pre-war levels. The drop in Gold has been accompanied by a sharp rise in Oil prices, which has fueled inflation concerns and reinforced expectations that the Federal Reserve (Fed) will keep interest rates higher for longer.