Forex Today: Gold surges above $4,240 as US labor data crumbles

Here is what you need to know for Thursday, August 6:

Metals were the biggest earners of the day on Wednesday, with Gold surging more than 4% to trade near $4,247 per troy ounce and Silver rallying almost 5% toward $62.20 amid a softer-than-expected US labor market report, with a slowdown in private hiring.

ADP private payrolls rose by just 44K in July, short of the 70K forecast and a sharp deceleration from the previous month's print of 98K, while the ISM Services PMI came in at 54.1 against expectations of 54.5. The employment sub-index told the more troubling story, collapsing to 47.4 from 51.2 and confirming that the hiring slowdown is no longer confined to one survey.

The US Dollar Index (DXY) eases around 0.16% and trades near 99.70, trading in a narrow range for the last four days, amid a de-escalation in the US-Iran war with both countries close to resuming peace talks.

Reuters reported that Iran and Oman are in the final stages of drafting an agreement on commercial shipping through the Strait of Hormuz, an arrangement that would hand Tehran greater control over transiting vessels. Citing a senior Iranian source, the agency added that Tehran has dropped its original demand for full control over traffic in both directions but is unlikely to soften its position further. US President Donald Trump said a deal could be announced as soon as Wednesday or Thursday.

EUR/USD advances around 0.15% and trades near 1.1550, extending its recovery toward the top of the recent range. The pair drew additional support from final HCOB surveys, with the July Eurozone Composite index revised up to 52.

GBP/USD adds around 0.08% and trades near 1.3460, lagging its peers as Cable continues to consolidate without domestic catalysts.

USD/JPY rises around 0.06% to near 157.80, little changed as the Bank of Japan (BoJ) Minutes of the June meeting showed policymakers debating price risks that would likely require further hikes even as they lifted rates to a 31-year high of 1%, with two members calling for a faster pace toward neutral.

USD/CAD falls around 0.35% to trade near 1.4013, with the Canadian Dollar the strongest major performer, trimming the USD gains of the last three days.

West Texas Intermediate (WTI) Oil steadies around $75.08 per barrel, pausing after two sessions of heavy losses as traders await formal confirmation of the Hormuz arrangement.

Gold rallied more than 4% on Wednesday to trade near $4,247 per troy ounce after as weaker-than-expected United States employment data pressured the US Dollar.

On Thursday, Australia will publish June trade figures during the Asian session, with the Trade Balance expected to narrow to a deficit of 1,100 million from 3,018 million.

Europe opens with German Factory Orders, forecast to slow to 0.3% MoM in June from 1.9%, followed by the European Central Bank Economic Bulletin. Eurozone Retail Sales are expected to rise 0.1% MoM, down from 0.2%, with the annual pace decelerating to 1% from 1.6%.

In the United States (US), the labor market remains the focus ahead of Friday's Nonfarm Payrolls. Initial Jobless Claims are forecast at 202K, up from 197K. Preliminary second-quarter Nonfarm Productivity is seen accelerating to 0.6% from 0.3%, with Unit Labor Costs expected at 2%, up from 1.8%. Fed's Musalem is also scheduled to speak.