Oil Falls, Stocks Rise, Gold Recovers
Gold prices continued their rally after reports that the US was seeking a diplomatic path to end the war in the Middle East, which helped break a nine-day losing streak. Gold briefly rose about 1.8% and returned above US$4,500 an ounce, extending gains after a 1.6% surge in the previous session.
US President Donald Trump said Iran was offering a “gift” as a gesture of goodwill in negotiations, linking it to energy flows through the Strait of Hormuz. Axios reported that Washington and regional mediators discussed the possibility of holding high-level peace talks as early as Thursday, but were still awaiting a response from Tehran.
The shift in sentiment was evident across assets: oil weakened, equities rose, and the Bloomberg Dollar Index fell about 0.2%. Since the war began more than three weeks ago, gold has tended to move with stocks and against oil, as expensive energy fuels inflation concerns and reinforces expectations of higher interest rates—typically a drag on the non-yielding precious metal.
Despite the lull in pressure, the market remains vulnerable. Iran remains firmly in control of Hormuz and Israel continues its offensive, while the Trump administration has ordered the deployment of approximately 2,000 additional personnel from the 82nd Airborne Division to the Middle East, adding to the thousands of troops scheduled to arrive within days. The combination of uncertain diplomacy and military escalation keeps gold's direction sensitive to headlines.
On the capital flow front, liquidity pressures in recent weeks have prompted investors to sell gold to raise cash amid weakening global stocks and bonds. There have also been reports that some central banks are considering using gold reserves to stabilize currencies; Turkey is said to be preparing additional options, including potential gold-foreign exchange swaps in the London market, amid war-induced volatility.
At 8:03 a.m. in Singapore, spot gold rose 1.6% to US$4,546.55 per ounce. Silver rose 2.4% to US$72.89, after gaining 3% in the previous session. Platinum and palladium also rose, while the Bloomberg Dollar Index fell 0.2%.
Source: Newsmaker.id
