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Gold holds near $4,102 as oil drops on US-Iran pause
WTI is near $82.50 per barrel, down more than 7%, as traders weigh a key Fed decision and US PCE inflation this week.
Gold opened the week higher, with XAU/USD trading around $4,102 and up 1.24% on the day, as a temporary pause in attacks between the United States and Iran improved risk sentiment and sent oil prices sharply lower, according to FXStreet.
A US statement through UN envoy Mike Waltz said the Trump administration is giving negotiations space while keeping military options available, while Tehran said it would refrain from fresh attacks if Washington did the same. However, the Iranian foreign ministry said the Strait of Hormuz remained unchanged and that the strategic waterway is closed, keeping some caution around the metal.
Oil weakness is also feeding back into how investors view gold, FXStreet said, noting gold is showing a degree of decoupling from its traditional safe-haven role since the US-Iran conflict began. WTI was trading near $82.50 per barrel, down more than 7%, as lower oil prices can ease inflation worries and reduce hawkish Fed expectations.
Looking ahead, FXStreet pointed to Wednesday’s Federal Reserve decision and Thursday’s US Personal Consumption Expenditures, with the central bank expected to hold rates steady. Still, traders reportedly price in a 33% chance of a hike, with a September rate increase probability near 79%, while the US Dollar Index was around 101.28, after recovering from an intraday low of 101.12.
Latest closeGold $4,055.70 ▲0.2%|WTI crude $90.47 ▼1.9%|Dollar index 101.47 ▲0.0%