Gold Holds Near $4,200 as Traders Await Fed Minutes

Gold prices held near a two-week high on Monday, July 6, consolidating below the $4,200 per ounce level as markets awaited clearer signals on the Federal Reserve's interest rate path. The precious metal's recent stabilization follows a volatile period, with spot gold trading around $4,156 after briefly touching its highest point since June 22 earlier in the session.

The consolidation reflects a market reassessing the outlook for U.S. monetary policy. Last week, gold posted its first weekly gain since mid-May, rising more than 2% after a softer-than-expected U.S. jobs report for June tempered expectations for imminent interest rate hikes. Data showed job growth slowed and previous months' payroll gains were revised lower, pointing to a cooling labor market.

This shift in economic data prompted traders to dial back bets on a rate increase. According to the CME FedWatch Tool, the probability of a rate hike in September has declined to about 55-56%, down from over 60% prior to the jobs report. Lower interest rates typically support gold, a non-yielding asset, by reducing the opportunity cost of holding it.

However, uncertainty persists, keeping prices in a narrow range. A stronger...