Gold Price Rises on Weaker Dollar, Middle East Tensions

Gold prices extended their gains on Thursday, reaching $4,080 per ounce as the US dollar weakened. This rally comes after a 2% increase in gold prices on Wednesday.

The Federal Reserve's decision to keep interest rates at 3.50%-3.75%, with Chair Kevin Warsh reaffirming the central bank's commitment to bringing down inflation, provided some support for gold despite its general tendency to be negatively affected by expectations of higher interest rates.

However, escalating tensions in the Middle East, particularly after the US military struck dozens of IRGC targets in Iran, have raised concerns over renewed inflationary pressures and boosted demand for safe-haven assets like gold.