Gold gains momentum above $4,100 after weak US NFP data

• Gold price edges higher to near $4,125 in Friday’s Asian session.

• US Nonfarm Payrolls increased by 57,000 last month, weaker than expected.

• US and Iran concluded a round of indirect talks on Wednesday with no sign that they had made headway toward lasting peace.

Gold price (XAU/USD) gains traction to around $4,125 during the early Asian session on Friday. The precious metal extends the rally after weaker-than-expected US Nonfarm Payrolls ‌(NFP) data reduced expectations of Federal Reserve (Fed) interest rate hikes this year.

Data released by the US Bureau of Labor Statistics (BLS) on Thursday showed that the US economy added 57,000 jobs in June, below the market consensus of 110,000. Meanwhile, the Unemployment Rate fell to 4.2% during the same period, down from 4.3% in May. That followed a report on Wednesday showing that US private payrolls increased less than expected in June.

"The lower-than-expected jobs number portends to less likelihood of potential rate hikes later this year. As we know, gold has a tendency to perform better in lower interest rate environments," said David Meger, director of metals trading at High Ridge Futures. "Hence, we saw a significant rally in the gold market on the back of that," he added.

Reuters reported that the US and Iran concluded a round of indirect talks on Wednesday with no sign that they had made headway toward lasting peace. Uncertainty or signs of a prolonged conflict in the Middle East could raise inflation worries, prompting traders to raise their bets on rate hikes and weighing the non-yielding bullion.