Gold rose to its highest price since late April's crash on renewed hopes for Federal Reserve interest-rate cuts, lower treasury yields and a weakened U.S. dollar.
June gold futures on the New York Mercantile Exchange recently rose 1.6% to $2,378.3 a troy ounce, having reached as high as $2,382.9 earlier in the session, the highest point since April 22.
Bullion hit an all-time high last month, peaking at $2,448.8 an ounce on April 12 after a rally underpinned by strong demand from central banks and geopolitical tensions, before tumbling to as low as $2,285.2 on May 3.
Investors are now hopeful for a Fed rate cut after initial jobless claims in the U.S. surged to their highest level in several months, said Rania Gule, market analyst at broker XS.com.
Thursday's jobless claims report amplified existing sentiments stirred by last week's disappointing nonfarm payrolls report, and further exposed vulnerabilities in the American labor market, said Ricardo Evangelista, senior analyst at ActivTrades wrote in emailed commentary.
This makes earlier interest-rate cuts by the Fed more likely in the eyes of market participants, heaping pressure on the U.S. dollar and causing bond yields to fall, both tailwinds for gold, said Commerzbank analyst Carsten Fritsch.
Higher interest rates are typically negative for gold as it doesn't pay interest, said analysts from BMI, a unit of Fitch Solutions. The Fed is expected to cut rates this year, and BMI's U.S. economist expects the first cut in September, followed by two in November and December.
June gold futures on the New York Mercantile Exchange recently rose 1.6% to $2,378.3 a troy ounce, having reached as high as $2,382.9 earlier in the session, the highest point since April 22.
Bullion hit an all-time high last month, peaking at $2,448.8 an ounce on April 12 after a rally underpinned by strong demand from central banks and geopolitical tensions, before tumbling to as low as $2,285.2 on May 3.
Investors are now hopeful for a Fed rate cut after initial jobless claims in the U.S. surged to their highest level in several months, said Rania Gule, market analyst at broker XS.com.
Thursday's jobless claims report amplified existing sentiments stirred by last week's disappointing nonfarm payrolls report, and further exposed vulnerabilities in the American labor market, said Ricardo Evangelista, senior analyst at ActivTrades wrote in emailed commentary.
This makes earlier interest-rate cuts by the Fed more likely in the eyes of market participants, heaping pressure on the U.S. dollar and causing bond yields to fall, both tailwinds for gold, said Commerzbank analyst Carsten Fritsch.
Higher interest rates are typically negative for gold as it doesn't pay interest, said analysts from BMI, a unit of Fitch Solutions. The Fed is expected to cut rates this year, and BMI's U.S. economist expects the first cut in September, followed by two in November and December.