World gold prices are heading for their first week of gains after many volatile sessions, as investors continue to monitor the prospect of reaching an agreement between the US and Iran.
Spot gold prices rose 0.7% to 4,719.85 USD/ounce. Over the week, this precious metal increased by about 2.3%.
Meanwhile, US gold futures for June delivery increased 0.4% to 4,728.30 USD/ounce.
The latest developments in the Middle East continue to be a major factor affecting market sentiment. The US and Iran had artillery duels on May 7, considered the most serious test of the ceasefire that has lasted for a month. However, Iran said that the situation has quickly returned to stability, and the US affirmed that it does not want to escalate tensions.
According to Mr. Kyle Rodda - senior financial market analyst at Capital. com, statements from President Donald Trump's administration show that the ceasefire is still maintained and the two sides are still optimistic about the possibility of reaching an agreement.
These signals are supporting the gold market in the short term" - Mr. Kyle Rodda said.
Previously, gold prices had fallen by more than 10% since the conflict broke out at the end of February, due to a sharp increase in oil prices, raising concerns about inflation escalating. When inflation increases, the market often expects central banks to maintain higher interest rates for longer, putting pressure on gold - an unprofitable asset.
Mr. Kyle Rodda believes that in the short term, the gold market may continue to fluctuate strongly according to information related to the negotiation process between the US and Iran.
Investors are waiting to see if the US and Iran are getting closer to an agreement. Gold prices may continue to fluctuate sharply in the next 24 hours before closing the trading week," he said.
In addition to geopolitical factors, investors are currently also focusing on the US non-farm payroll report to be released this day. This is considered an important data to help the market assess the monetary policy outlook of the US Federal Reserve (Fed).
According to a Reuters survey, the number of non-farm jobs in the US last month may have increased by 62,000 jobs, much lower than the increase of 178,000 jobs in March.
On other precious metals markets, spot silver prices increased by 1.6% to 79.74 USD/ounce. Platinum prices increased by 1.3% to 2,048.08 USD/ounce, and palladium increased by 1.2% to 1,498.62 USD/ounce.
