Gold maintained its rebound, trading at approximately $4,385 an ounce, following a 1% rise the previous day that ended a three-day decline. This surge was attributed to US President Donald Trump's remarks indicating that military actions in the Middle East would likely be brief, which eased concerns about inflation fueled by rising energy prices.
The price of spot gold specifically increased by 0.1% to $4,386.94 an ounce by 7:56 a.m. in Singapore. Oil's price rally also slowed after Trump's statements, which helped calm fears of an extended conflict that could drive inflation, typically a negative factor for non-yielding assets like gold.
The dollar also experienced a slight weakening, following a significant rise in the Japanese yen, prompting speculation about potential intervention by Japanese authorities to support their currency. A softer dollar generally enhances gold's appeal for investors holding other currencies, further contributing to its price stability.
Adding to the positive sentiment for gold, Federal Reserve Bank of New York President John Williams noted ongoing inflation easing, particularly as the impact of tariffs diminished and higher energy costs were not broadly affecting other services. This tempered expectations for an interest-rate hike, a sentiment reinforced by data showing a moderate pace of job additions by US companies in August, despite earlier hawkish signals from Fed Chairman Kevin Warsh about potential rate increases.
