Gold Rises as Oil Prices Drop Amid US-Iran Conflict Pause

The price of gold rose on Monday as the US-Iran conflict paused, causing oil prices to drop to a one-week low. Spot gold increased by 0.9% to $4,087.59 per ounce, while US gold futures for August delivery gained 0.5% to $4,090.

Bart Melek, global head of commodity strategy at TD Securities, said that the oil market's decline from over $100 last week to $90 is driving interest rate outlook lower. Lower energy prices ease inflation concerns and reduce bets for higher-for-longer interest rates.

Investors are now awaiting the US Federal Reserve's interest rate decision on Wednesday, with 66% of traders expecting policymakers to hold interest rates steady. However, they are pricing in about a 79% chance of a US rate hike in September.