Gold prices extend gains as investors weigh Middle East tensions

Gold prices rose further on August 7, extending gains from the previous session as investors weighed escalating tensions around the Strait of Hormuz against expectations for the U.S. Federal Reserve's next policy decision while awaiting key U.S. employment data.

Spot gold was up 0.6% at $4,264.22 per ounce as of 01:04 ET (05:04 GMT), while U.S. gold futures also gained 0.6% to $4,323.07 per ounce, Caliber.Az reports via foreign media.

Other precious metals also advanced. Spot silver rose 1.2% to $62.26 per ounce, while platinum gained 0.6% to $1,740.05 per ounce.

Gold briefly traded above the $4,300-per-ounce level on August 6 as optimism over a possible agreement related to the Strait of Hormuz boosted demand for the safe-haven asset.

However, the rally later eased as renewed regional tensions revived concerns that higher energy prices could fuel inflation and strengthen the case for the Federal Reserve to maintain a tighter monetary policy stance.

Market participants are now awaiting the release of key U.S. payrolls data, which could provide further guidance on the outlook for interest rates and influence demand for gold and other precious metals.

By Sabina Mammadli