Article details
Gold (XAU/USD) held steady near $4,760 on Friday, set to close the week with a 2% gain as the US Dollar weakened amid optimism over Iran-US talks in Pakistan over the weekend. A slightly elevated US inflation report also reduced expectations of the Federal Reserve's dovish stance in 2026, limiting the Dollar's appeal. The Dollar Index (DXY) fell below 103, pressured by geopolitical tensions and reduced Fed rate-cut speculation.
The Dollar's decline is critical for gold traders, as a weaker USD typically boosts bullion demand. Geopolitical risks from the Iran-US negotiations add to safe-haven demand for gold. However, the Fed's delayed rate cuts could cap gold's upside, as lower yields reduce the opportunity cost of holding non-yielding assets.
Investors should monitor the outcome of the Iran-US talks and upcoming US inflation data for clues on Dollar direction. Central bank gold purchases and ETF flows will also influence the metal's trajectory. Technical levels near $4,750 and $4,850 may act as immediate support and resistance.
