Gold Prices Surge to Two-Week High Amid US-Iran Deal Hopes
Gold prices rallied to a two-week high on Wednesday as hopes for a US-Iran peace deal weighed on the USD. The yellow metal surged past $4,100 during the Asian session after investors became optimistic about a diplomatic resolution to end the five-month-old conflict.
The news of a potential US-Iran deal and the reopening of the Strait of Hormuz led some follow-through USD selling, benefiting gold. US Treasury Secretary Scott Bessent said that the US could reach a deal with Iran to reopen the Strait by Wednesday, while Axios reported that the US, Iran, and Oman are closing in on an interim agreement.
The OPEC+ decision to increase production from September helped ease supply concerns and dragged crude oil prices to a fresh low since June 13. This alleviated inflation concerns and hawkish Fed expectations, which are seen exerting pressure on the USD and supporting gold.