Gold drops over 1% on higher oil prices; US payrolls data in focus

Gold weakened on Friday as a recovery in oil prices renewed concern about inflation and the prospect of interest rates staying high, Business Recorder reported. Spot bullion was down 1.1% at $4,044.09 an ounce by 0501 GMT, although it remained on course for its strongest weekly performance since late August. December-delivery US gold futures lost 1.5% to $4,053.30.

Oil climbed more than 1% on the day, despite expectations that it would record a steep weekly decline, while ongoing Middle East supply concerns continued to support prices. Investors were awaiting US non-farm payroll figures scheduled for 1330 GMT; markets priced in a 68% chance of a December Fed rate increase, compared with near certainty last month. Goldman Sachs also cut its end-2026 gold forecast to $4,150 an ounce from $4,650, citing a more hawkish Fed stance.