Gold prices held firm during Asian deals on Wednesday, maintaining a recovery above the US$4,600 level as improving risk sentiment and a softer U.S. dollar supported the precious metal.
Spot gold was up 0.1% at US$4,672.84 per ounce by 3:25 pm AEDT (4:25 am GMT).
The metal has regained upward momentum this week as optimism surrounding a potential de-escalation in the Middle East conflict reduced demand for the U.S. dollar as a safe-haven asset, allowing gold to rebound from heavy losses recorded in March.
Comments from Donald Trump have continued to shape market sentiment. In a recent interview, the president reiterated expectations that the conflict with Iran could end within “two to three weeks”, reinforcing hopes of a near-term resolution.
Trump also signalled that reopening the Strait of Hormuz may not be a priority for the United States, suggesting other nations could take responsibility for the key shipping route.
Earlier remarks indicated Washington could end the conflict even if the Strait remains closed.
Attention is now turning to upcoming U.S. economic data, which could provide further direction for both the dollar and gold.
Investors are closely watching labour market indicators for clues on the outlook for monetary policy from the Federal Reserve.
Private sector employment data from ADP is due later in the session, with markets expecting an increase of around 40,000 jobs.
Recent labour data has already pointed to some softening. The Bureau of Labor Statistics reported in its Job Openings and Labor Turnover Survey (JOLTS) that vacancies fell to 6.882 million in February from 7.24 million in January, coming in below market expectations.
Looking ahead, the key focus for markets remains the U.S. nonfarm payrolls report due later this week on Good Friday, which is expected to provide a clearer signal on labour market conditions and the trajectory of interest rates.
