Spot Gold extended gains to a fresh 7-week high of $3,444.40 on Friday, following reports of Israeli military strikes on Iran, which spurred demand for traditional safe-haven assets.
Israel said it had initiated widescale strikes against Iran on Friday, targeting nuclear facilities, ballistic missile factories and military commanders, as tensions intensified over US efforts to prevent the Islamic state from building an atomic weapon.
“Moments ago Israel launched Operation Rising Lion, a targeted military operation to roll back the Iranian threat to Israel’s very survival. This operation will continue for as many days as it takes to remove this threat,” Israeli Prime Minister Benjamin Netanyahu said in a video message, cited by Reuters.
In response, Iran had launched nearly 100 drones heading towards Israel.
In the meantime, according to a Reuters report, the US armed forces are preparing for various contingencies in the region, including potential assistance with evacuating American civilians.
On the data front, US initial jobless claims stood at an eight-month high during the past week, indicating labor market cooldown.
Additionally, slowing domestic demand restrained producer inflation in May. The latter, taken in conjunction with softer CPI inflation added to expectations of an earlier Fed rate cut.
Markets are now pricing in 55 basis points of rate cuts by year-end, as early as September rather than October.
Spot Gold was last up 0.94% on the day to trade at $3,418.34 per troy ounce.
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