Gold prices snapped a two-day losing streak during Wednesday's Asian session, rebounding from weekly lows near US$4,850 as buyers made another push toward the key US$5,000 level.
By 3:55 pm AEDT (4:55 am GMT), spot gold (XAU/USD) was trading 1.2% higher at US$4,934.22 per ounce.
The precious metal is now eyeing fresh catalysts from the minutes of the United States Federal Reserve’s January monetary policy meeting, due later in the session.
Trading conditions remain relatively subdued, with liquidity and physical demand dampened by a week-long holiday in China.
Markets are currently pricing in around 60 basis points of total easing this year, according to the CME Group FedWatch Tool, as moderating inflation expectations offset still-solid U.S. labour market data.
Recent commentary from Federal Reserve officials has reinforced market expectations that further rate cuts remain on the table, reviving dovish sentiment around the U.S. central bank’s policy outlook.
Meanwhile, geopolitical developments are also underpinning the metal’s safe-haven appeal. Markets remain cautious after a round of talks between the United States and Iran in Geneva concluded without a final agreement.
Iranian Foreign Minister Abbas Araqchi said on Tuesday that Tehran has agreed with the US on "guiding principles" for the deal, but uncertainty surrounding the outcome has helped sustain some defensive positioning in bullion.
At the same time, the U.S. dollar attempted to stabilise after an overnight pullback, as rebalancing flows resumed ahead of the Fed minutes release.
