(RTTNews) – Gold edged higher on Thursday after Israel and Lebanon agreed to implement a ceasefire and continue negotiations for a broader peace agreement.
Spot gold jumped 0.8 percent to $4,468.73 an ounce while U.S. gold futures for August delivery were up 0.7 percent at $4,496.70.
After a fourth round of U.S.-mediated talks, Israel and Lebanon have agreed to renew their fragile ceasefire following days of bombardment and drone strikes.
According to a joint statement, the agreement was “contingent on a complete cessation” of attacks by the Iran-backed armed group Hezbollah, among other conditions.
Elsewhere, the U.S. House of Representative passed a resolution that seeks to halt President Donald Trump from taking further military action in Iran. However, analysts say that the resolution is unlikely to come into effect.
The dollar eased while Treasury yields were little changed as ongoing Middle East tensions heightened risks to global growth.
After overnight ADP employment data showed resilience in the U.S. labor market, traders have increased bets that the Federal Reserve’s next move will be to raise interest rates.
Federal Reserve Bank of Dallas President Lorie Logan on Wednesday said she believes it’s taking too long for inflation to return to the central bank’s 2 percent target and therefore officials may need to raise interest rates later this year.
Separately, New York Fed President John Williams said U.S. monetary policy is in right place, but he sees no obvious direction for the future path of interest rates.
In Europe, ECB board member Pierre Wunsch noted that any developments concerning a peace agreement in the Midde East would become an important part of the discussions within the central bank during the upcoming June meeting.
On the data front, Eurozone retail sales fell more than expected in April, adding to concerns that the euro zone economy could contract in the second quarter.
ECB President Lagarde’s speech and U.S. weekly jobless claims figures may garner attention later in the day ahead of the U.S. government’s all-important monthly employment report due on Friday.
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