Home›Commodities›Precious Metals›Gold jumps most since February as Hormuz deal hopes li…

Gold jumps most since February as Hormuz deal hopes lift demand

Spot gold rose 4.2% to $4,248.45 an ounce as markets trimmed expectations for Fed hikes to a single increase by year end.

Reported · Written up by our desk · Precious Metals

Gold surged the most since February, supported by mounting expectations for a deal to reopen the Strait of Hormuz and by fresh technical momentum in bullion. LiveMint Markets, citing Bloomberg, reported prices rose more than 4% to around $4,250 an ounce after a breakout above a key resistance level. The potential reopening of the critical waterway also coincided with a weaker US dollar, with US oil extending losses. The story said markets moved to fully price a single US rate increase by year end, down from two expected just last week, which reduced pressure on the Fed’s rate outlook. The report linked the rally to typical precious metals drivers, noting that less monetary tightening tends to be supportive because gold generates no yield. Nicky Shiels, head of metals strategy at MKS PAMP, said the move was also reinforced by investors positioning for a weaker dollar or higher inflation ahead of the Fed’s September meeting, after gold had traded sideways for weeks. LiveMint Markets added that gold has fallen by nearly a fifth since the US-Iran war began in late February, with energy price spikes raising inflation pressures and increasing the chance rates remain higher for longer. Spot gold gained 4.2% to $4,248.45 an ounce by 4:12 p.m. New York time, while silver rose 4.2% to $62.07 an ounce, as silver also climbed.

Latest closeGold $4,308.50 ▲5.2%|Silver $62.32 ▲3.8%

More like this

Sources