Gold up at $4,061 despite Middle East, inflation concerns

August 04, 2026 (MLN): Gold prices moved higher, weighed by persistent uncertainty surrounding the Middle East conflict and mounting concerns over inflation, as traders positioned themselves ahead of a batch of US employment data expected to shape the Federal Reserve's next policy move.

Currently, spot gold is slightly up 0.45% to $4,061.66 an ounce as of [12:18 pm] PST, according to data reported by Mettis Global.

Three Fed policymakers who had pushed for a rate increase at last week's meeting cautioned that postponing tighter monetary policy risked keeping inflation entrenched above the central bank's 2% target.

Adding to inflationary pressure, Brent crude futures surged over 20% in the preceding month after renewed hostilities between the US and Iran, coupled with attacks on tankers near Oman, stoked fresh security concerns across energy markets.

Elevated oil prices have reinforced market expectations that the Fed will hold interest rates higher for an extended period to keep inflation in check, a scenario that typically dampens demand for non-yielding assets like gold, according to CNBC.

Adding a further layer of uncertainty, Iran stated that no negotiations with Washington were currently underway and that no meetings were planned, a position that directly contradicted earlier claims by President Donald Trump, who had pointed to upcoming talks as the rationale behind halting military strikes.

Investor attention this week is largely fixed on a series of US labour market indicators, including the ADP employment report and the closely watched nonfarm payrolls figures, both of which are expected to offer fresh clues on the Fed's policy trajectory.

Separately, South Korea's central bank disclosed plans to purchase gold directly from domestic producers, a move aimed at diversifying its supply sources and building up its precious metal reserves. 

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