Overnight, however, reports emerged that the U.S. had paused further strikes, with advisers including Vice President JD Vance and Joint Chiefs Chairman Gen. Dan Caine raising concerns about munitions stockpiles and escalation risks. The apparent lull cooled safe-haven bidding just as the dollar recovered 0.3% from Thursday's 2.4% plunge — its largest single-day drop since January 2023.
Monetary policy remains a parallel driver. The Federal Reserve held rates steady on Wednesday, and Chair Kevin Warsh offered little forward guidance. CME FedWatch data show traders now pricing a 63% probability of a September hike, down from roughly 80% before the meeting. Lower rate-hike expectations have eased pressure on Treasury yields, supporting non-yielding bullion.
Technical analysts remain cautious. RHB Research notes gold reclaimed its 20-day simple moving average but warns the 50-day SMA still slopes lower. The firm maintains a short position initiated at $4,605.70 in March, with resistance seen at $4,200 and a stop-loss at that same level. Immediate support is pegged at $4,000, followed by $3,850.
Central bank demand, a long-term pillar, showed an unexpected wrinkle: the World Gold Council sharply revised first-quarter 2026 purchases to 57 tonnes from an earlier 244-tonne estimate, the weakest opening quarter in over 15 years. Second-quarter global demand held steady at 1,268.9 metric tonnes year-on-year, with accelerated central bank buying offsetting an investment slump.