Gold moved closer to the $5,000 per ounce mark on Thursday, building on a 2% gain from the previous day as investors waited for important economic data from the United States.
Traders are watching new inflation and economic growth numbers due later this week. These figures will help signal what the U.S. central bank, the Federal Reserve, might do next with interest rates.
Minutes from the Fed’s January meeting showed that officials are not fully aligned. Some prefer to pause interest rate cuts for now and wait to see if inflation improves. Others even suggested that rates could rise again if price pressures return. Because of this uncertainty, traders have reduced their bets on multiple rate cuts this year.
Gold usually benefits when interest rates fall, so fewer expected cuts can slow its rally.
At the same time, short-term demand for gold softened during China’s Lunar New Year holiday. With many traders away and activity lower than usual, buying momentum eased.
Geopolitical tensions also returned to the spotlight. Reports suggested that if the U.S. were to take military action against Iran, it could turn into a prolonged campaign. Such uncertainty tends to support gold, which investors often buy during times of global risk.
For now, gold sits at a delicate balance, supported by global tensions, but cautious ahead of key U.S. economic data that could shape the next move in interest rates.
