June 7, 2025 | Reuters – Gold prices edged higher on Friday and were poised for weekly gains, as softer-than-expected US economic data overshadowed initial optimism from a rare phone call between President Donald Trump and Chinese President Xi Jinping.
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As of 05:48 GMT, spot gold rose 0.3% to $3,363.33 per ounce, while US gold futures advanced 0.4% to $3,387. For the week, bullion has gained 2.3%.
Investor sentiment was initially buoyed by the Trump-Xi call, which touched on trade tensions and critical minerals, but enthusiasm faded as persistent labor market weakness in the US took center stage.
“Some of the initial enthusiasm for risk appetite following the Trump-Xi call has started to wear off, which has enabled gold to creep higher,” said Tim Waterer, Chief Market Analyst at KCM Trade.
US weekly jobless claims rose to a seven-month high, reflecting a cooling job market. The spotlight now shifts to the nonfarm payrolls (NFP) report, due at 1230 GMT, with economists forecasting a 130,000 job increase in May and unemployment holding at 4.2%.
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Waterer noted that a significant surprise in the NFP data could trigger a market breakout in gold prices.
Meanwhile, Federal Reserve officials emphasized that inflation remains a greater concern than employment softness, signaling no immediate interest rate cuts—conditions generally favorable for gold, which thrives in low-rate, high-uncertainty environments.
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All four precious metals are set to end the week higher.
However, high gold prices led to reduced physical demand in major Asian markets. India, in particular, saw discounts reach their highest level in over a month.
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