Gold Reaches Seven-Week High as Dollar Weakens Amid Iran-Oman Talks
Gold prices rebounded to a seven-week high on Thursday, reaching $4,265.22 an ounce after a four-day advance. The metal's rally was fueled by weakening dollar and Treasury yields, as well as reduced fears of inflation following signs that Iran and Oman may reach an agreement to restore shipping through the Strait of Hormuz.
The initial conflict between the US and Iran disrupted energy supplies, lifting oil prices and fueling concerns about inflation. However, the latest developments have pushed crude lower, reducing expectations of rate hikes by the Federal Reserve.
Despite the rally, gold remains 19% below its level on February 28 when the US-Iran conflict began. Traders are now waiting for Friday's official US employment report, which could impact yields and the dollar, thereby affecting gold prices.
Analyst Tony Sycamore notes that a sustained break through $4,490 would strengthen momentum and potentially reopen a path towards $5,000.