Last night I realized that today would already be Thursday, and after all the recent Thursday bank holidays, it’s time to get back into the usual market commentary rhythm.
Gold price under pressure
That said, there are weeks when one would gladly skip the market commentary. While there is no backing out, please remember that I am just the messenger. The message: gold has lost some of its investment luster in recent days.
Impact of US labor market data
Gold prices came under pressure last Friday, after US labor market data turned out significantly above expectations. This caused the interest rate futures markets to firmly factor in a Fed interest rate hike by the end of the year, as well as another one by mid-2027. Yields on US Treasury bonds rose sharply, and the US dollar also appreciated.
Geopolitical risks and oil prices
Unfortunately, the signs regarding the Middle East conflict are not pointing toward de-escalation. The rising oil prices have also weighed on gold prices repeatedly in recent weeks. Furthermore, technical analysts expressed the view that gold has come under greater pressure due to its drop below the 200-day moving average of around 4,400 US$ per ounce.
An overview of recent gold price trends
While gold traded at around 4,460 US$ per ounce last Wednesday morning and hit a daily high of 4,515 on Thursday, it dropped to 4,325 on Friday afternoon following the release of US jobs data at the end of the week. Prices remained near that level until Tuesday afternoon but have since plummeted in view of the escalating tensions in the Iran conflict, to a low of 4,024 overnight. At the start of European trading this morning, gold traded at around 4,095 US$ per ounce, indicating at least a slight recovery.
Xetra-Gold price development
The Xetra-Gold price declined along the same lines, from 123.50 € per gram last Wednesday morning to 124.70 on Thursday afternoon. It dropped sharply on Friday and again since Tuesday afternoon, in line with the US dollar gold price, to 114.55 yesterday afternoon. Xetra-Gold was expected to open this morning at around 114 € per gram.
Market outlook: fragile situation amid sound fundamentals
The situation for gold prices remains fragile. The case for patience and medium-term gains is supported by the fact that the fundamental factors which drove gold prices higher in 2025 and at the start of this year appear to remain intact, such as the diversification of positions in US Treasuries, the continued rise in global government debt, and the increasing demand for gold in Asia. However, various central banks, among them the ECB this afternoon, are likely to raise key interest rates, a move which will impact gold prices negatively.
I wish all readers a relaxing weekend.