Gold Stabilizes Near Seven-Week High Amid Easing Inflation Fears
Gold prices held steady at around $4,271 per ounce on Thursday, maintaining its position near a seven-week high. The precious metal has been gaining momentum for the fourth consecutive session, driven by easing concerns over inflation and interest rates.
The Strait of Hormuz crisis appears to be easing, with a proposed deal between Iran and Oman potentially paving the way for oil flows to resume. This development is contributing to reduced fears around inflation, in turn decreasing bets on aggressive Federal Reserve tightening.
Nikos Tzabouras, senior market analyst at Jefferies-owned Tradu.com, noted that 'Gold tries to hold onto its recent gains today amid growing optimism around the Strait of Hormuz. Hopes for a diplomatic breakthrough that restores oil flows are easing inflationary fears and paring back aggressive Fed tightening bets.'
Market expectations for a September US rate hike have eased to 55% from 67% over the past two days, further contributing to gold's stability.