Gold traded above $4,550 an ounce on Tuesday, extending gains of about 1% from the previous session, supported by signs that the US and Iran are moving closer to an agreement that could end the conflict and reopen the Strait of Hormuz. Talks between Washington and Tehran have reportedly focused on extending the ceasefire by roughly two months, during which the US would lift its blockade while Iran would allow shipping through the strait to resume.
Even so, significant hurdles remain, particularly over Iran’s nuclear program and its insistence on maintaining control over maritime traffic in the strategic waterway. At the same time, oil prices fell sharply, easing concerns about inflationary pressures and the likelihood of additional interest rate increases. Despite the recent rebound, gold remains down about 13% since the conflict began, as fears of an energy-driven inflation shock have reinforced expectations that central banks may keep monetary policy tighter for longer.
