Gold extends recovery on US-Iran deal

Gold prices rose in European trading on Friday, extending their recovery for a second consecutive session from two-month lows, supported by continued bargain buying and lower oil prices amid improving relations between the United States and Iran and growing expectations of a deal that could end the war in the Middle East.

Lower oil prices are easing inflationary pressures on Federal Reserve policymakers, reducing the likelihood of US interest rate hikes this year, as investors await additional economic data and comments from Federal Reserve officials.

Price Overview

• Gold prices today: Gold prices rose around 0.8% to $4,530.41, from the opening level at $4,496.03, and recorded a low of $4,489.17.

• At Thursday’s settlement, gold prices gained 0.9%, marking their first advance in the past three sessions, after earlier falling to a two-month low of $4,366.68 per ounce.

• Aside from bargain buying activity, risk appetite improved amid reports of further progress in peace negotiations between the United States and Iran.

Global oil prices

Global oil prices fell around 2.0% on Friday, extending losses for a third consecutive session and hitting their lowest levels in five weeks, amid rising hopes that the Strait of Hormuz will reopen to shipping and oil tankers.

Lower oil prices help ease concerns about accelerating inflation, potentially giving global central banks more room to keep interest rates unchanged in the near term, while expectations for rate cuts over the longer term continue to grow.

Latest developments in the Iranian war

• The United States and Iran have reached an agreement, but it still requires Trump’s final approval.

• The agreement includes a 60-day ceasefire, the lifting of restrictions on navigation through the Strait of Hormuz, and further nuclear negotiations.

• US President Donald Trump requested a few days to consider the final agreement.

US interest rates

• Alberto Musalem, President of the Federal Reserve Bank of St. Louis, said the central bank may need to raise its benchmark interest rate if inflation does not resume its decline over the next six months.

• John Williams, President of the Federal Reserve Bank of New York, said the central bank’s monetary policy is moving in the right direction given current expectations.

• Williams added that he expects inflation to remain elevated in the near term before easing later this year.

• According to the CME Group’s FedWatch tool, market pricing for a Federal Reserve rate hike at the December meeting has declined from 56% to 47%.

• Markets continue to price a 99% probability that interest rates will remain unchanged at the June meeting, while the probability of a 25-basis-point rate hike stands at 1%.

• Investors are closely monitoring additional US economic data, along with comments from Federal Reserve officials, in order to reassess those expectations.

SPDR Fund

Gold holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell by approximately 2.29 metric tons on Thursday, bringing total holdings down to 1,032.56 metric tons, the lowest level since October 15, 2025.