Gold edges higher on US-Iran deal optimism

Gold prices edged higher on Tuesday as a preliminary U.S.-Iran peace agreement eased concerns over potential Federal Reserve rate hikes, while investors awaited further details on the deal, News.Az reports, citing Reuters.

Spot gold rose 0.3% to $4,317.43 per ounce and was on track to extend gains to a fourth consecutive session.

Meanwhile, U.S. gold futures for August delivery slipped 0.3% to $4,338.70.

U.S. President Donald Trump said on Monday that a preliminary agreement to end the war in the Persian Gulf had been signed by the US and Iran, although details have not been made public and both sides have said a permanent truce has yet to be negotiated.

The U.S. dollar remained near 10-day lows, making dollar-priced bullion cheaper for holders of other currencies.

Traders have reduced expectations for a U.S. rate hike in December to 57% following the peace deal, down from about 70% last week, according to the CME FedWatch tool.

Gold typically loses appeal when interest rates rise, as it does not yield interest.

Meanwhile, the Bank of Japan raised interest rates to a 31-year high in its first hike since December, aligning with other central banks that are shifting toward tighter monetary policy to combat inflation.

Elsewhere in precious metals, spot silver fell 0.9% to $69.42 per ounce, platinum lost 0.3% to $1,762.34, and palladium declined 1.1% to $1,333.13.

News.Az 

By Nijat Babayev