US-Iran Tensions Ease, Gold Prices Surge on Lower Oil and Dollar

Gold prices surged more than 1% on Monday after easing tensions between the United States and Iran pushed oil prices lower, reducing inflation expectations ahead of the Federal Reserve's policy meeting. The spot gold price climbed 0.97% to $4,090.77 an ounce as of [09:33 am] PST.

The rally came after reports that Iran is prepared to suspend military operations provided the United States also refrains from further strikes, easing concerns over a broader regional conflict. The softer geopolitical outlook triggered a sharp decline in oil prices of more than 4%, according to CNBC.

A weaker U.S. dollar also supported bullion, with the dollar index falling 0.3%, making gold less expensive for buyers using other currencies. Lower energy prices have eased fears of persistent inflation, shifting investor attention toward the Federal Reserve's interest rate decision.