Gold Surges as Mideast Fighting Pause Reduces Inflation Risk

Gold prices surged after a pause in fighting between the US and Iran reduced inflation risk. Spot gold climbed 1.3% to $4,103.43 an ounce at 9:45 a.m. in Singapore.

The halt in hostilities eased oil supply risks and decreased the likelihood of higher interest rates from the Federal Reserve. The pause also had a positive impact on global markets, with Brent crude paring its losses after initially falling by more than 7% to below $90 a barrel.

Bullion has largely hovered around $4,000 an ounce since late June, with dip-buying keeping it above the psychological threshold. However, Justin Lin, an analyst at Global X ETFs, noted that a 'meaningful resolution' between the US and Iran is needed for gold to break beyond its current range of $4,000 to $4,200.