Gold Prices Soar on Rate Hike Fears and Iran Conflict Progress

Gold prices rose to their highest level in almost seven weeks on Wednesday, climbing 4.1% to $4,242.96 per ounce by 12:50 p.m. ET (1650 GMT), its highest since June 18.

The increase was driven by lower Treasury yields and hopes for progress on opening the Strait of Hormuz, according to Tai Wong, an independent metals trader.

Wong noted that 'early adopters' are buying back into precious metals as the likelihood of rate hikes has fallen since last week, while the dollar's sharp fall makes gold cheaper for overseas buyers.

However, gold is still down around 24% since hitting a record high of $5,595 in January and down 19% since the start of the Iran war fueled concerns about energy inflation and reinforced bets on interest rate hikes.