Gold moved higher in Asian trading on Wednesday, supported by a softer dollar and declining crude prices as signs of reduced tensions in the Middle East eased immediate inflation concerns.
Spot gold rose 1.8% to $4,637.14 an ounce by 22:47 ET (02:47 GMT). U.S. Gold Futures for June climbed 1.7% to $4,647.31. The yellow metal had gained nearly 1% in the prior session.
Developments in Washington contributed to the market shift. U.S. President Donald Trump said on Tuesday that Washington would pause an operation aimed at restoring commercial shipping through the Strait of Hormuz and that a deal with Iran was close. The announcement marked a turn toward diplomacy after heightened tensions earlier in the week, when Trump’s "Project Freedom" initiative to secure maritime routes through the strait triggered a military response from Iran and pushed oil prices sharply higher.
Gold, long viewed as a safe-haven asset, had been pressured as the earlier spike in energy prices fed inflation concerns and strengthened expectations that interest rates could remain higher for longer - dynamics that typically weigh on non-yielding bullion. The subsequent pullback in crude prices in Asian trading after the Washington comments eased some worries about prolonged supply disruptions and helped temper inflation expectations, which provided relief to gold markets even as geopolitical risk premiums declined.
Currency moves also supported the rally. The U.S. dollar weakened against major peers on growing optimism over a potential U.S.-Iran agreement, making gold relatively cheaper for holders of other currencies. The DXY traded 0.2% lower in early Asian hours.
Other precious metals registered notable gains. Silver jumped 3% to $75.08 per ounce, while platinum rose 1.7% to $1,990.72 per ounce.
This market response reflects a mix of geopolitical developments, energy price dynamics, and currency movements that together influenced inflation expectations and demand for safe-haven assets.
Data points and price moves referenced above are based on trading in Asian hours and market quotes available at the noted times.