Gold Prices Rebound as Iran Strikes Lift Safe-Haven Demand Ahead of Fed Decision

Gold prices rebounded to around $4,090 on Wednesday as renewed Iranian strikes lifted safe-haven demand. The August COMEX gold futures contract opened at $4,020.90, down 0.4% from Tuesday's settlement, but quickly reversed direction and rose to its current level by 8:17 a.m. ET.

The rebound was driven by increased tensions in the Middle East, with Brent crude prices jumping 6.6% to $89.61 in response to the military escalation. This move has been significant for gold, as it has helped push the metal's price above $4,000.

However, the rally is expected to be short-lived, as the Federal Reserve's decision on interest rates at 2:00 p.m. ET today will likely have a major impact on gold prices. The Fed is expected to keep rates unchanged in its target range of 3.50%-3.75%, but the uncertainty surrounding this decision has been weighing on gold prices.

Silver, which carries roughly twice gold's beta to oil prices, is telling a slightly more positive story, with a price increase of 1.36% to $57.92 per troy ounce. However, the gold-silver ratio has widened to 70.27 from 69.81, indicating that risk-off positioning may be having a greater impact on industrial metals.