Gold prices rose in European trading on Wednesday, moving back into positive territory, supported by a weaker US dollar and declining oil prices, as investors monitored signs of progress in peace negotiations between the United States and Iran.

Lower oil prices are easing inflation concerns in the United States, reducing pressure on Federal Reserve policymakers and lowering the probability of additional US interest rate hikes before the end of this year.

Price Overview

• Gold prices today: Gold prices rose 0.45% to $4,527.97, from the opening level at $4,507.98, and recorded a low of $4,485.94.

• At Tuesday’s settlement, gold prices lost 1.4%, marking the third loss in the past four sessions, following US strikes on Iran.

US dollar

The dollar index fell 0.1% on Wednesday, heading toward its second loss in the past three sessions, reflecting weaker performance of the US currency against a basket of global currencies.

The decline comes as investors maintain optimism over continued progress in peace talks between the United States and Iran amid intensive diplomatic efforts to resolve the remaining points of disagreement between the two sides.

Global oil prices

Global oil prices fell by more than 2% on Wednesday, resuming losses that had temporarily paused yesterday and moving back near five-week lows amid hopes that the Strait of Hormuz could reopen to oil tankers.

Latest developments in the Iranian war

• Iran said the latest US strikes violate the ceasefire agreement.

• A possible preliminary agreement to permanently end the war could pave the way for further negotiations.

• US Secretary of State Marco Rubio said an agreement with Iran could take a few days.

• Both sides had previously indicated progress toward a preliminary agreement to end hostilities and resume shipping through the strait.

US interest rates

• According to the CME Group’s FedWatch tool, markets are currently pricing in a 56% probability that the Federal Reserve will raise interest rates in December, compared to just over 16% at the beginning of May.

• Markets are currently pricing a 99% probability that US 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.

Gold outlook

Market strategist Ilya Spivak said: “The broader trend appears bearish, but we are seeing extended periods of consolidation, and I believe that is what we are witnessing today.”

Spivak added that inflation risks and bond market volatility have become so significant that they have shifted attention away from gold’s yield dynamics, meaning gold prices could fall to between $3,700 and $3,800 by the end of the year if the current trend continues.

SPDR Fund

Gold holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, remained virtually unchanged on Tuesday for the second consecutive session, keeping total holdings at 1,034.85 metric tons, the lowest level since May 8.

The New Zealand dollar rose broadly on Wednesday against a basket of global currencies, moving toward its highest level in at least two weeks against its US counterpart, after hawkish signals from the Reserve Bank of New Zealand following its decision to leave interest rates unchanged.

The decision came amid a sharp division and a historic vote split within the Reserve Bank of New Zealand’s Monetary Policy Committee, which indicated that interest rates may need to rise in the coming months to counter accelerating inflation in the country, lifting expectations for a New Zealand rate hike in July.

Price Overview

• New Zealand dollar exchange rate today: The New Zealand dollar rose 0.7% against the US dollar to 0.5878, from today’s opening level at 0.5837, and recorded a low of 0.5836.

• The New Zealand dollar ended Tuesday’s trading down 0.6% against the US dollar due to risk aversion after the United States carried out strikes on Iranian boats and missile sites.

Reserve Bank of New Zealand

The Reserve Bank of New Zealand (RBNZ) on Wednesday kept its benchmark interest rate unchanged at 2.25%, the lowest level since July 2022, in line with most market expectations, marking the third consecutive meeting without change.

The six-member Monetary Policy Committee at the Reserve Bank of New Zealand saw a complete split in voting, with three members voting to keep rates unchanged, while three other members — the external members — voted in favor of an immediate 25 basis point rate hike. The final decision to hold rates steady was determined by the casting vote of Governor Anna Breman.

In its updated monetary policy statement, the New Zealand central bank confirmed that the war in the Middle East and rising energy prices would keep inflation above the target range this year.

The New Zealand central bank said: “Overall, the official cash rate is likely to need to rise more quickly and to higher levels than anticipated in the monetary policy statement issued in February.”

The bank added: “The pace of official cash rate increases will depend on the extent to which persistent wage and price pressures outweigh the impact of weak economic activity on medium-term inflation pressures.”

Reserve Bank of New Zealand Governor Anna Breman said her view and that of the group supporting her decision were based on the desire to wait for more economic data before taking a tightening step.

Breman explained that the economic impact of the Iranian war and the disruption to shipping in the Strait of Hormuz would continue for a long period even after hostilities cease.

She acknowledged that New Zealand households are going through difficult conditions due to rising prices, but reassured markets that the situation would begin improving next year.

New Zealand interest rates

• Following the meeting, markets raised pricing for the probability of a 25 basis point New Zealand interest rate hike at the July 8 meeting to above 70%.

• Markets also raised pricing for the probability of a 25 basis point rate hike at the September meeting to above 90%, with expectations that New Zealand will deliver three interest rate increases this year.

• Investors will closely monitor the release of several important New Zealand economic data points in the coming period, including inflation, unemployment, and economic growth figures, in order to reassess those expectations.

Gold prices fell by more than 1% on Tuesday as bets on additional US interest rate hikes this year increased after US military strikes on Iran reduced hopes for a peace agreement, pushing oil prices higher and bringing inflation concerns back into focus.

Spot gold fell 1% to $4,526.86 per ounce, while US June gold futures rose 0.1% to $4,527.90 per ounce.

Jim Wyckoff, market analyst at American Gold Exchange, said: “Bond markets believe the Federal Reserve’s next move will be an interest rate hike, and that is a negative factor for the gold market today.”

Kevin Warsh was sworn in as chairman of the Federal Reserve on Friday, taking over leadership of the US central bank amid growing expectations of tighter global monetary policy.

Markets are currently pricing in a 25 basis point US interest rate hike in December. Although gold is considered a hedge against inflation, the non-yielding precious metal struggles in a high interest rate environment.

In another sign of mounting inflation concerns, Brent crude prices rose by more than 3% on Tuesday as uncertainty persisted over the possibility of a peace agreement between the United States and Iran that would allow shipping through the Strait of Hormuz to reopen.

Higher oil prices increase inflationary pressures as manufacturers pass rising costs on to consumers.

Wyckoff added: “Short-term technical indicators still favor sellers, which is also triggering some technical selling activity.”

He noted that markets will closely monitor US personal consumption expenditures price index data for April, due on Thursday, as a key indicator for measuring inflation pressures and determining the future direction of US monetary policy.

In the same context, UBS lowered its year-end gold price forecast by $400 to $5,500 per ounce due to continued risks related to higher yields and a stronger US dollar.

As for other precious metals, spot silver fell 2.1% to $76.43 per ounce, platinum declined 0.9% to $1,950.71, while palladium slipped 0.2% to $1,396.26 per ounce.

Highway service stations will be a core part of the transition to electric vehicles, but urgent action is needed to unlock electricity grid capacity, according to Tim Gittins.

The number of electric vehicles on British roads has now surpassed two million, a strong indication of the speed of transformation taking place in the transport sector, as well as the scale of the challenge facing policymakers and businesses to ensure infrastructure is capable of supporting this transition in practice, not just in theory.

Since the opening of Watford Gap in 1959 as the UK’s first motorway service station, these sites have continued adapting to the needs of an increasingly mobile country by supporting long-distance travel, improving road safety, and ensuring drivers transporting goods relied upon across the country have places to rest, making them an essential part of Britain’s logistics network.

Today, with the government focused on boosting economic growth, accelerating housebuilding, and advancing transport decarbonization, the role of motorway service stations is evolving once again to become even more central to achieving those goals.

Roadchef, which operates sites serving millions of drivers annually, says the importance of these stations goes far beyond convenience, as they represent part of the country’s critical national infrastructure. They not only provide safe places for rest, but also support freight movement, labor mobility, and economic activity across the country.

Motorway service stations as critical national infrastructure

As pressure on the transport network increases, the importance of this role continues to grow, requiring long-term planning in cooperation between government and industry.

After recently securing 75-year lease extensions in partnership with the Department for Transport and National Highways at five locations, including Watford Gap, the company is now able to invest tens of millions of pounds in upgrading facilities, increasing capacity, and preparing the network to meet the needs of the next generation of road users and vehicles.

The benefits of these investments extend beyond infrastructure improvements, contributing to job creation, higher productivity, and stronger regional development, while creating broader opportunities for growth.

Developing new motorway service stations in underserved areas could also become a catalyst for regional growth by improving connectivity, creating local jobs, and attracting additional investment.

To meet housing targets and support infrastructure projects, expanding heavy truck facilities is also considered essential to ensuring the success of Britain’s construction sector and achieving balanced development plans.

Large-scale homebuilding depends on the efficient transport of materials and workers, while the infrastructure supporting these supply chains is facing mounting pressure. With appropriate investment and planning support, motorway service stations can play a decisive role in ensuring these networks function smoothly and in turning housing targets into actual homes.

The electric vehicle revolution could stall without electricity grid reform

Electricity grid capacity is currently the biggest obstacle to deploying fast-charging stations for electric vehicles, especially in rural and remote areas.

The UK National Audit Office found that only 10% of motorway service stations currently have sufficient electricity capacity to meet expected electric vehicle charging demand by 2035.

If Britain is serious about ensuring fair access to electric vehicles and decarbonizing freight transport, policy must address electricity grid constraints that are hindering infrastructure development at key points along the strategic road network.

Motorway service stations will be essential to this transition, as reliable roadside charging can reduce one of the biggest barriers to electric vehicle adoption, support cleaner freight and transport journeys, and ensure the benefits of electrification reach regions outside major cities.

Roadside charging is expected to account for a significant share of total electric vehicle charging activity by 2050, making it a core part of the national network.

Roadchef is already investing to meet this demand, with plans to establish 1,000 electric vehicle charging points across its sites by 2030.

However, building a comprehensive network capable of serving drivers, commercial fleets, and heavy electric trucks requires urgent action to unlock electricity grid capacity in the areas that need it most.

Public-private cooperation

A new model of effective cooperation between the public and private sectors is increasingly emerging in infrastructure projects.

When organizations such as National Highways, local authorities, and private operators like Roadchef are able to align on key investment priorities, meaningful progress becomes possible, giving businesses the confidence to invest for the long term while delivering broader benefits to society.

These investments are also improving the experience of millions of motorway service station users annually through expanded partnerships with British retail and hospitality brands, upgraded facilities, and responses to changing consumer expectations.

Motorway service stations are no longer simply places for temporary stops, but have become environments focused on experience, comfort, and variety.

Today, these stations sit at the intersection of several of the British economy’s most important priorities: growth, connectivity, decarbonization, and execution.

With the right policy framework and continued commitment to long-term investment, motorway service stations can evolve from being merely a supporting element of the transport network into a driving force behind a cleaner, more resilient, and better connected British economy.