Gold prices gained on Thursday,
supported by lower crude oil prices and a weaker dollar, as
investors assessed renewed expectations for a resolution to the
US-Israeli war with Iran.
Spot gold was up 0.7% at $4,461.09 per ounce, as of
0218 GMT. U.S. gold futures for August delivery gained
0.5% to $4,487.90.
The dollar eased, making greenback-priced bullion more
affordable for holders of other currencies.
“Gold’s gains are still very much at the mercy of oil and
the dollar. It only moves higher when they pull back, making it
highly dependent on positive U.S.-Iran headlines for any
sustained momentum,” said Tim Waterer, chief market analyst at
KCM Trade.
Israel and Lebanon agreed to implement a ceasefire to end
hostilities, the Trump administration said on Wednesday,
boosting hopes for a broader deal to end the Iran conflict.
The Republican-led U.S. House of Representatives approved a
resolution on Wednesday to block U.S. President Donald Trump
from continuing the war against Iran, reflecting growing concern
among members of his party about the three-month-old conflict.
Oil prices eased in early trade on Thursday, as the
ceasefire between Lebanon and Israel boosted hopes of a
U.S.-Iran peace deal.
Elevated oil prices can accelerate inflation and keep
interest rates higher for longer. While gold is seen as a hedge
against inflation, higher rates tend to weigh on the
non-yielding metal.
New York Federal Reserve President John Williams noted that
he does not expect upside risks to inflation caused by the war
in the Middle East to be long-lasting and reiterated there was
no need at this time to change U.S. monetary policy.
“I don’t think we’ve seen the end of the bull run, but it is
clearly time for a shakeout in general. So I anticipate choppy
trade as we head into the year end, with a slight upwards bias
of around $5,000,” said Matt Simpson, a senior analyst at
StoneX.
Spot silver rose 0.6% to $73.13 per ounce, platinum
gained 0.7% to $1,872.11, and palladium added 0.9%
to $1,313.51.