Gold prices have stabilized above recent multi-week lows as investors await critical U.S. economic data that could provide fresh momentum for the precious metal. On June 5, 2024, gold strengthened its position after a period of downward pressure, reflecting the complex interplay of market forces and investor sentiments.

The XAU/USD pair rose by 0.22% to $2,332.24 over the past 24 hours, while August futures for American gold increased by 0.20%, reaching $2,352.10.

This recent stabilization in gold prices followed a decline that saw the metal hitting its lowest level in several weeks. This downturn was largely influenced by stronger-than-expected U.S. economic indicators, which bolstered the dollar and heightened expectations of further interest rate hikes by the Federal Reserve. A stronger dollar typically makes gold more expensive for holders of other currencies, thereby reducing demand.

Despite these pressures, gold has found support and is now consolidating as traders and investors brace for upcoming U.S. economic data. Key reports on employment, inflation, and manufacturing are expected to provide insights into the state of the U.S. economy and the Fed’s future policy moves. These data are crucial as they are likely to influence the Fed's decisions on interest rates, which in turn will affect gold prices.

Recent performances of gold highlight its dual role as both a hedge against economic uncertainty and an asset sensitive to changes in monetary policy. While stronger economic data and the prospect of higher interest rates exert pressure on gold, ongoing geopolitical tensions and concerns about global economic growth continue to bolster its appeal as a safe-haven asset.