Gold Rises with Eyes on Fed Meeting

Gold climbed more than 1% to above $5,030 per ounce on Monday, reaching its highest level in over a week, as investors awaited key US economic data that could offer clearer guidance on the Federal Reserve’s interest rate outlook. The January jobs report due Wednesday, which is expected to show signs of stabilization in the labor market, as well as inflation data set for release on Friday will be closely watched. The precious metal also gained support from political developments in Japan, where a landslide victory for incumbent Prime Minister Sanae Takaichi strengthened expectations of looser fiscal and continued downward pressure on the yen. In addition, demand from central banks remained strong, with China’s central bank extending its gold purchases for a 15th consecutive month in January. On the geopolitical front, attention remains on US-Iran talks, with both sides agreeing to continue discussions this week to ease tensions and avoid a military confrontation.

Gold rallied over 3.5% to above $4,950 per ounce on Friday and was set for weekly gains after a week of sharp two way moves, as signs of US economic softening and lingering geopolitical uncertainty combined with the aftereffects of forced selling to drive volatility. The rebound followed a late January liquidation wave triggered by higher margin requirements and a steep selloff in silver that spilled across precious metals, pushing prices lower before buyers re entered. Weaker US labour data, with weekly initial jobless claims rising to 231k and announced job cuts jumping to roughly 108k in January, reinforced expectations for Federal Reserve easing later this year, lowering real yield expectations and restoring a fundamental bid for bullion. US Iran talks in Oman described as a good start eased immediate escalation risks without removing broader uncertainty, sustaining gold’s defensive appeal, while a softer US dollar and position rebuilding further amplified the rebound.

Gold rose to around $4,870 per ounce on Friday, reversing earlier losses as markets navigated heightened volatility. The swings that began late last week continued, wiping out most of its year-to-date gains, weighed by selling pressure after the metal repeatedly hit record highs in January. Meanwhile, US job cuts reached 108.4K in January, the highest for the month since 2009, while initial claims rose to 231K and ADP payrolls missed forecasts. The string of weaker labor data reinforced expectations for Federal Reserve rate cuts later this year, with markets eyeing a first move in June. On the geopolitical front, the White House emphasized that President Donald Trump prefers a diplomatic solution with Iran, signaling patience for high-level negotiations while keeping military options as a contingency. Over the week, gold remained on track for its second consecutive weekly loss.