Gold surged past $4,300 an ounce this week, posting a weekly gain of more than 7% as progress toward reopening the Strait of Hormuz eased oil prices and cut the odds of a September Fed rate hike. A soft US jobs report added fresh momentum on Friday, while China's steady buying and a wave of new derivatives filings underpinned the broader move.
Spot gold climbed past $4,326 on Friday, its highest level in seven weeks, capping a weekly gain of more than 7%. The rally started with cooling inflation fears tied to US-Iran talks over the Strait of Hormuz, then accelerated after a soft US jobs report cut into Federal Reserve rate-hike bets.
Hormuz progress cuts Fed hike odds
Progress toward reopening the Strait of Hormuz pushed crude oil prices down roughly 10% on the week. President Trump said he believed the war would end "pretty soon" and that the US remained in control of the strait. Cheaper oil eases near-term inflation pressure, and that has cut the CME FedWatch-implied odds of a September rate hike to about 55%, down from 67% a week earlier.
Fresh flare-ups complicated that picture: Iranian media reported Tehran had struck targets in the strait and planned to bar US and Israeli vessels from the waterway, while Iran-backed Houthi militants in Yemen reportedly carried out a fresh attack on Saudi Arabia, raising concerns the conflict could broaden.
Silver tracked the move, jumping 4.4% to $64.16 for a weekly gain of about 11.6%. Together, the two metals added roughly $2.2 trillion in combined market capitalization this week.
Nonfarm payrolls give the rally new legs
Gold sharply extended its gains on Friday after the US jobs report came in negative, prompting traders to pare Fed rate-hike bets. Spot gold climbed 2.9% to $4,363.99 an ounce, with futures rising the same amount to $4,423.87.
Tony Sycamore, senior market analyst at IG, said the breakout suggests gold may have confirmed a bottom near its late-June low around $3,942. Holding above that level would strengthen the case for a run toward the 200-day moving average near $4,489, he said, and a sustained break above that could open the door to $5,000.
Meanwhile, St. Louis Fed President Alberto Musalem said policymakers cannot afford to tolerate persistently high inflation while waiting for the possibility that stronger productivity growth may eventually ease price pressures.
China's steady buying underpins the floor
China's central bank added to its gold reserves for a fifth straight month in July, the largest single-month purchase since October 2023, reinforcing the structural demand case behind the rally. Chinese bullion-backed exchange-traded funds have also logged 14 consecutive sessions of inflows, helping stabilize prices despite broader macroeconomic headwinds.
That structural bid extends to derivatives too: Kalshi has filed to launch futures on gold, silver and platinum, pointing to institutional appetite for precious-metal exposure beyond traditional venues.
Still, Han Tan, chief market analyst at Bybit, warned that a stronger-than-expected payrolls print could re-price Fed hike odds higher and test the rally. Gold remains a recovery trade rather than a fresh record: it still sits roughly 23% below its January 2026 peak.
Sources: CoinGape, Commodities & Futures News
Trading involves risk.
Risk Disclaimer
