Gold Prices Soar on Weaker Dollar and Hormuz Hopes
The price of gold surged on Wednesday, with spot gold trading over 4.3% higher at $4,252 an ounce, its highest level since June 18. The surge in gold prices was driven by a weaker U.S. dollar and renewed hopes that the Strait of Hormuz could reopen.
President Donald Trump told Fox News on Tuesday that the U.S. and Iran were 'having very good discussions,' adding that the Strait of Hormuz could reopen very soon. This comment weighed heavily on the U.S. dollar, which fell 0.11% in tracking a third consecutive session of losses.
Long-time gold advocate Peter Schiff pointed to the weak July ADP jobs report as a key catalyst behind the 'nice breakout for precious metals.' The ADP reported that private employers added 44,000 jobs in July, down from a revised 95,000 in June and well below economists' expectations of 75,000.
Despite Wednesday's rally, gold is still down over 24% from its January record high of $5,602.2, and around 20% since the U.S.-Israeli strikes first hit Iran on Feb. 28, 2026. On a year-to-date basis, gold is down nearly 1.7%.
Independent metals trader Tai Wong told Reuters that early investors were returning to gold and silver as expectations for further interest rate hikes had eased. Retail sentiment surrounding the SPDR Gold Shares ETF (GLD) remained 'bullish' over the past 24 hours, while iShares Silver Trust (SLV) turned 'extremely bullish.'