On the COMEX, gold futures were trading at $4,319.30 per ounce, up $19.70 or 0.46%. Silver futures climbed 1.48% to $62.515 per ounce, outperforming gold in early trade.
The focus remains firmly on the US July jobs report, due later in the day.
The data is expected to shape market expectations on whether the Federal Reserve will raise interest rates at its September policy meeting.
Gold is on track for its strongest weekly gain since January. The precious metal has found support from easing crude oil prices, which have helped cool inflation concerns. Lower energy prices can reduce expectations that interest rates will stay elevated for longer, a factor that generally supports demand for non-yielding assets such as gold.
However, gains remain measured as traders continue to price in the possibility of another US rate hike. According to the CME FedWatch Tool, markets currently assign around a 55% probability of a rate increase in September.
Recent comments from Federal Reserve officials have also kept rate expectations elevated. St Louis Fed President Alberto Musalem said the central bank should have raised rates at its July meeting, where policymakers kept the benchmark interest rate unchanged at 3.5%-3.75% despite inflation remaining above the Fed’s 2% target.
Meanwhile, US labour market data released overnight painted a mixed picture. Initial jobless claims rose slightly last week, while layoffs fell to a two-year low in July, indicating the labour market remains broadly resilient.
Investors are also monitoring geopolitical developments after US President Donald Trump said he believes the conflict with Iran could end soon, even as he acknowledged supply issues affecting some military equipment.
The US employment report, along with wage growth and unemployment data, is expected to be the key driver for gold and silver prices in the near term. Stronger-than-expected jobs data could reinforce expectations of higher interest rates, while weaker numbers may boost bullion by increasing hopes of a pause in monetary tightening.
-With Reuters inputs
