Gold Prices Rise Over 2% Following U.S.-Iran Preliminary Agreement

Gold prices surged by more than 2% at the start of the new week, following the announcement of a preliminary agreement between the United States and Iran aimed at ending conflicts and reducing regional tensions. This development coincided with a decline in the value of the U.S. dollar and a drop in global oil prices.

According to global market reports, the spot price of gold rose 2.5% to $4,322.87 per ounce, marking its highest level since June 9. Meanwhile, U.S. gold futures contracts for August also increased by a similar margin, climbing to $4,344.80 per ounce.

U.S. and Iranian officials stated that the agreement outlines a framework to end the war, lift the U.S. economic blockade against Iran, and reopen the Strait of Hormuz. The Strait of Hormuz is one of the world’s most critical oil transit routes, and any changes there can impact energy markets.

Following the news, the U.S. dollar fell to its lowest level in ten days, while oil prices dropped by more than 4%. Market analysts suggest that lower oil prices may ease inflationary pressures, thereby creating a more favorable environment for gold prices to rise.

Tim Watters, Senior Market Analyst at KCM Trade, said that the decline in oil prices and the weakening dollar, both resulting from reduced geopolitical risks, have been major factors supporting the gold market in recent days. However, he emphasized that the sustainability of this trend depends on the durability of the agreement between the two countries.

Some financial institutions also believe that concerns about geopolitical instability and global financial policies continue to support long-term demand for gold, although a possible interest rate hike could exert pressure on the market.

Other precious metals have also seen upward trends; silver, platinum, and palladium each experienced price increases exceeding 3%.

Investors are now awaiting the U.S. Federal Reserve’s upcoming decision on interest rates, a move that could shape the future direction of global markets.