Gold price hits highest level since June on weak payrolls data and Hormuz deal hopes

Gold rose to its highest level since late June on Wednesday, amid weaker-than-expected payrolls data and hopes for a reopening of the Strait of Hormuz. Spot gold rose as high as $4,295 per ounce before paring gains to settle around $4,268 per ounce on Thursday. Gold futures were last seen trading at $4,329 per ounce. The precious metal enters its fourth consecutive winning session and hovers near a seven-week high as some of the headwinds that have held it back since the war began ease off slightly. Hiring at private companies slowed considerably in July, with most of the job growth coming from healthcare, payrolls processing firm ADP reported Wednesday. A weaker ADP report reduces the likelihood of a Fed interest rate hike in September, which would provide some relief for non-yielding gold. Meanwhile, joint U.S.-Japan intervention in the yen late last week set the stage for a slightly weaker dollar as it is thought Tokyo sold almost $60 billion of Treasuries to prop up its ailing currency. American yen purchases were reportedly funded by the sale of euros. The dollar index, which tracks its performance against a basket of major currencies, hovers around 6-week lows at around 99.78. During the course of the conflict, gold has traded inversely to both oil prices and the greenback. One final catalyst behind a boost to the gold price is an easing of tensions in the Middle East, as efforts to reopen the Strait of Hormuz gather momentum. On Wednesday, Iran said a deal with Oman to reopen the critical waterway is close to being agreed, offering welcome news to risk assets. Despite the recent bounce, gold still trades over 20% below its late January peak of $5,589 per ounce. The yellow metal has endured a tough six months, sitting well below its all-time high achieved earlier this year after a blistering rally that extended through and beyond 2025.