Trump Comments Lift Gold as Iran Tensions Ease

This sentiment led to a decline in the US dollar (down 0.1%) and a significant drop in crude oil prices (over 10%). The easing of geopolitical tensions is seen as reducing pressure on gold, which had previously faced headwinds from concerns about inflation and reduced likelihood of Federal Reserve interest rate cuts.

Higher oil prices due to the Strait of Hormuz closure and missile strikes had fueled inflation fears, making rate cuts less probable—a negative for non-interest-paying gold. While gold has also served as a liquidity source during global equity routs, the current market reaction reflects a shift in safe-haven demand.

Despite the daily gain, trading remains choppy, and Trump offered no specifics, stating he doesn't expect the conflict to end this week. Gold has still gained approximately 20% this year, largely supported by broader geopolitical uncertainties and trade upheavals.