Gold Price Steady Amid Hormuz Flare-Up and Interest Rate Uncertainty

The price of gold remained steady on August 7 as traders assessed the impact of a reported Iranian attack in the Strait of Hormuz on the US Federal Reserve's path for interest rates.

Bullion was trading around $4,245 an ounce after ending the previous session down 0.2 per cent.

The Strait of Hormuz is a critical waterway and Iran had earlier said a pact with Oman to open shipping lanes was in the final stages.

Despite the attacks, US President Donald Trump told reporters at the White House that he thinks the war will end 'pretty soon' and that the US is in control of the strait.

The Fed's policymakers are concerned about inflationary pressures and have priced in a roughly 60 per cent chance of a hike in September after the Financial Times reported Fed chairman Kevin Warsh would be prepared to raise borrowing costs if inflation readings run hot in coming weeks.