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Gold jumps more than 4% as Hormuz deal hopes spark bullion buying
Gold rose 4.2% to $4,248.45 an ounce after breaking above key resistance, while markets cut their year-end Fed hike outlook to one from two.
Gold surged the most since February, rising more than 4% as expectations for a deal to reopen the Strait of Hormuz eased bets on additional US rate hikes. LiveMint Markets said the rally was also boosted by a technical breakout above a key resistance level, drawing in more buying.
Spot gold gained 4.2% to $4,248.45 an ounce by 4:12 p.m. in New York, with silver also climbing 4.2% to $62.07 an ounce. Platinum was little changed and palladium advanced.
A LiveMint Markets report attributed the rate outlook shift to the prospect of less monetary tightening, noting that gold pays no yield and tends to benefit when the dollar weakens. The US dollar index edged lower, while US oil extended losses.
The move comes after gold had been down nearly a fifth since the US-Iran war began in late February, as higher energy prices have pressured inflation and kept rate expectations elevated. LiveMint Markets also pointed to recent Federal Reserve messaging, including Lisa Cook’s view that policymakers may need to act if inflation does not slow toward the 2% target.
Latest closeGold $4,308.50 ▲5.2%|Silver $62.32 ▲3.8%|Platinum $1,750.20 ▲0.2%