Gold prices surged on Tuesday, with spot gold rising as much as 1.8% to approximately $5,240 per ounce, while US gold futures increased by 2.7%. Silver also gained, climbing 2% towards $90 per ounce.
The uptick followed US President Donald Trump’s remarks signaling an imminent end to the ongoing Middle East conflict, which, combined with falling oil prices, alleviated inflation fears that had pressured gold prices. Oil prices had increased over 30% since the start of the Iran conflict but tumbled in response to Trump’s comments, helping to ease investor concerns about sustained high inflation that could inhibit Federal Reserve rate cuts.
Despite a weekly drop of 3% in gold prices leading up to Tuesday, the metal has risen approximately 20% this year. However, analysts caution that risks persist, particularly regarding shipping through the Strait of Hormuz, and the energy sector remains elevated compared to pre-conflict levels.
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