FX.co ★ Gold Holds Gain Despite Rising Oil Prices

Gold hovered around $4,080 an ounce on Wednesday after gaining nearly 2% in the previous session, as investors weighed ongoing tensions in the Middle East, rising oil prices, and their implications for inflation and interest rates. President Donald Trump played down the likelihood of near-term talks with Iran and warned of further strikes, driving oil prices higher. Supply concerns were exacerbated by Iran-backed Houthi rebels in Yemen disrupting shipping through the Red Sea, as well as a series of attacks on the Caspian Pipeline Consortium terminal on Russia’s Black Sea coast.

On the data front, ADP figures showed that US private employers added an average of 16,500 jobs per week over the four weeks ending July 4, down from a weekly average of 19,250 in the previous four-week period, marking a fourth consecutive slowdown in hiring. Markets broadly expect the Federal Reserve to keep interest rates unchanged at next week’s meeting, while futures pricing reflects better than a 55% probability of a rate hike in September.