Gold closes higher, posts weekly gains of nearly 2%

Gold bars

Gold and silver prices rose on Friday, recording weekly gains after two consecutive weeks of losses. This was driven by optimism over a potential end to the Middle East conflict, which boosted risk appetite and eased concerns about inflation and tighter monetary policy.

Gold futures for June delivery increased 0.42%, or $19.80, to settle at $4,730.70 per ounce, posting weekly gains of 1.85%.

Silver futures for May delivery rose 0.87%, or 69.40 cents, to $80.395 per ounce, extending weekly gains to 5.85%.

Precious metals were supported by a weaker US dollar amid signs that the US and Iran remain committed to the ceasefire agreement and diplomatic negotiations, despite recent military skirmishes in the Strait of Hormuz.

These price movements come at a sensitive time for monetary policy, as Kevin Warsh is seen as increasingly likely to succeed Jerome Powell as Federal Reserve chair, while recent data showed the US economy added more jobs than expected in April.

The stronger labor market data reinforced investor confidence in the resilience of the economy, although concerns over the inflationary impact of the Middle East conflict continue to dominate the monetary policy outlook.