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Gold prices edged higher on Friday, building on gains from the previous two sessions, as investors balanced renewed geopolitical tensions between the United States and Iran against a stronger dollar and cautious signals from the Federal Reserve.
By 06:00 ET (11:00 GMT), spot gold rose 0.8% to $5,034.77 per ounce, while U.S. gold futures climbed 1.1% to $5,053.54 an ounce. The precious metal has rebounded sharply since midweek, reversing earlier losses as geopolitical risks resurfaced and revived safe-haven demand.
Trading volumes remained relatively light, however, with Chinese markets closed for the Lunar New Year holidays, amplifying price movements during the session.
Geopolitical Risks Support Bullion as Inflation Data Looms
Escalating diplomatic tensions between Washington and Tehran provided fresh support for gold. U.S. President Donald Trump warned on Thursday that Iran must reach a nuclear agreement within the next 10 to 15 days or face unspecified consequences, heightening fears of potential military action. Any escalation could disrupt oil supplies in the Middle East and unsettle global financial markets, bolstering demand for defensive assets.
Despite these geopolitical tailwinds, gold’s upside was partly capped by a firmer U.S. dollar and hawkish undertones from the minutes of the Federal Reserve’s latest policy meeting. The minutes dampened expectations for near-term interest rate cuts, weighing on non-yielding assets.
The U.S. Dollar Index was on track for a weekly gain of more than 1%, its strongest performance in months, a trend that typically pressures gold prices.
Investor attention has now turned to the release of the U.S. Personal Consumption Expenditures (PCE) Price Index later on Friday. As the Federal Reserve’s preferred measure of inflation, the data is expected to provide clearer guidance on the future path of U.S. monetary policy.
Other Metals Also Advance
Elsewhere in the metals market, prices broadly moved higher. Silver surged 3.9% to $80.69 per ounce, while platinum gained 2.9% to $2,131.30 an ounce.
Copper prices were more mixed. Benchmark London Metal Exchange copper futures edged up 0.1% to $12,828.20 a metric ton, while U.S. copper futures rose 0.4% to $5.7615 a pound.
Overall, precious metals remained supported by geopolitical uncertainty, even as macroeconomic factors and currency strength continued to shape near-term price dynamics.
