Gold prices rise for the fourth consecutive day
Gold reaches seven-week high
The international gold market continued its upward trend on Thursday, with prices rising for the fourth consecutive trading session.
Spot gold increased by 0.5% to $4,265.22 per ounce, marking its highest level since June 18. US gold futures also gained 0.5%, reaching $4,324.60 per ounce.
The latest rally came after gold recorded its biggest single-day increase since February in the previous trading session.
Why are gold prices rising?
Market analysts say several factors are supporting higher gold prices.
A weaker US dollar, falling US Treasury bond yields and renewed hopes of diplomatic progress in the Middle East have encouraged investors to move back toward gold.
According to IG Markets analyst Tony Sycamore, lower oil prices could also reduce pressure on central banks to increase interest rates.
If borrowing costs remain lower, gold usually becomes more attractive because it does not pay interest.
He also said that if gold continues to stay above its 200-day moving average, prices could eventually move toward $5,000 per ounce.
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Middle East developments boost confidence
Reports suggest that Iran and Oman are discussing a proposed agreement that could help end the five-month conflict between Iran and the United States.
The proposed arrangement could also allow Iran to maintain control over shipping through the Strait of Hormuz.
Analysts believe that hopes of improved regional stability have supported investor confidence, helping gold continue its recent gains.
Dollar weakness adds support
Another major reason behind the increase is the weaker US dollar.
When the dollar loses value, gold becomes cheaper for investors using other currencies, increasing global demand.
At the same time, the yield on the US 10-year Treasury bond has declined, making gold a more attractive investment option.
Investors await key US jobs report
Financial markets are now focusing on the upcoming US Non-Farm Payrolls report, which could influence future interest rate decisions.
Recent ADP employment data showed slower hiring in the US private sector during July.
The probability of another US Federal Reserve interest rate increase in September has also fallen to 55%, compared with 67% just two days earlier.
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Other precious metals
Silver slipped slightly by 0.1% to $62.02 per ounce.
Platinum rose 1.2% to $1,755.18 per ounce, reaching its highest level since June.
Palladium also gained 0.8% to $1,374.33 per ounce, recording its third consecutive session of gains.
