Gold prices climbed to their highest level since late June on Wednesday, buoyed by weaker-than-expected U.S. payrolls data and optimism over a potential reopening of the Strait of Hormuz. Spot gold rose as high as $4,295 per ounce before paring gains to settle around $4,268 per ounce, according to market data.
The U.S. private payrolls report for July, released by ADP, showed an increase of 122,000 jobs, below the 150,000 forecast by economists. This fueled expectations that the Federal Reserve may pause its interest rate hikes, making gold more attractive as a non-yielding asset.
Meanwhile, diplomatic efforts to reopen the Strait of Hormuz, a critical oil shipping route, have raised hopes of reduced geopolitical tensions in the Middle East. The strait had been closed due to recent conflicts, but negotiations have shown progress, according to reports from Reuters and other news agencies.
Analysts note that gold's rally could continue if economic data remains weak and geopolitical risks persist. However, some caution that any resolution in the Middle East could reduce safe-haven demand for the metal.
