Gold price continued its upward trajectory for the second consecutive day, reaching a one-week high on Monday. The escalation of geopolitical tensions in the Middle East provided a boost to the safe-haven XAU/USD. Additionally, expectations of a hawkish Federal Reserve and elevated US bond yields supported the USD and limited gains for the metal. On Friday, the Gold price witnessed a significant turnaround and rallied over 1.3% from its lowest level since March 8. This drop was a result of the US Nonfarm Payrolls (NFP) report, which increased the likelihood of another rate hike by the Fed in 2023. However, the report also revealed moderate wage growth and eased inflationary concerns, potentially softening the Fed’s hawkish stance. This led to a decrease in the USD for the third day in a row and prompted short-covering around the Gold price, breaking its nine-day losing streak. The escalating geopolitical tensions in the Middle East further supported the XAU/USD and led to a bullish gap opening on the first day of the week. However, the emergence of fresh USD buying is preventing further appreciation of the Gold price. Traders are now eagerly awaiting the release of the FOMC meeting minutes and US consumer inflation figures for further guidance.
