Gold Dips on Stalled US-Iran Talks, NFP Looms

The precious metal remains volatile amidst ongoing geopolitical turmoil, as US President Donald Trump indicated talks were in "final" stages, while Iran's Foreign Minister stated negotiations had stalled. This lack of progress, following recent violence where Iran fired missiles and drones at Kuwait and Bahrain, killing one person and injuring dozens, fuels inflation concerns and expectations of elevated interest rates.

Bart Melek from TD Securities noted that higher inflation expectations have pushed yields across the curve higher, kept the USD firm, and prompted markets to begin pricing in a Fed hike in late 2026. Investors are now focused on the US May employment report, which is expected to show a gain of 85,000 Nonfarm Payrolls and a steady Unemployment Rate of 4.3%.

Any signs of surprise weakening in the US labor market will undermine the US Dollar and support the USD-denominated gold price in the near term.