Gold (XAU/USD) regained momentum on Friday, climbing back above the $4,200 mark after a brief pullback from a three-week high touched the previous day. The move reflects broad risk-off sentiment and persistent weakness in the US Dollar (USD), which is pressured by concerns over slowing economic activity linked to the prolonged US government shutdown.

Investors are cautious about the outlook for the US economy, as delayed macroeconomic data—particularly employment and inflation figures—may not be released. This has prompted the Federal Reserve (Fed) to signal caution on further policy easing, limiting the extent of USD recovery. The mixed guidance from key Fed officials, including Neel Kashkari and Susan Collins, has encouraged traders to trim bets for a December rate cut. Nevertheless, markets still price in a roughly 50% probability of a 25-basis-point rate cut in December, with odds of further easing in January above 75%, supporting the bullish case for Gold.

The reopening of the US government has highlighted fiscal risks and potential GDP drag, with economists estimating that the shutdown could reduce quarterly growth by 1.5–2.0%. Signs of a weakening labor market also weigh on the USD, indirectly supporting Gold as a safe-haven asset.

From a technical perspective, Gold’s recent breakout above $4,150 and reclaiming $4,200 has reinforced bullish momentum. Daily and 4-hour oscillators indicate positive traction, suggesting that the path of least resistance remains upward. Key near-term resistance lies at the $4,245 swing high, above which Gold could target the $4,300 round figure.