Gold Rebounds Sharply, Market Focus Shifts to CPI
Gold prices rose to a three-week high on Wednesday (April 8) after the US dollar weakened following President Donald Trump's decision to agree to a two-week ceasefire with Iran, which also canceled plans to attack civilian infrastructure. Spot gold rose 2.7% to US$4,832.51/oz at 2:36 a.m. ET, its highest level since March 19, while US gold futures rose 2.7% to US$4,857.25/oz.
Trump said military action would be suspended for two weeks, less than two hours before an 8:00 p.m. ET deadline that had previously been the focus of market attention as a potential trigger for major escalation. The Pakistan-brokered ceasefire was conditional, with Iran being asked to ensure the reopening of the Strait of Hormuz—a passageway for about 20% of global oil flows—and shipping coordination with Iranian authorities. Trump also said the US would help ease traffic congestion in the strait.
The weakening dollar boosted precious metals, with the US dollar index falling nearly 1% in Asian trading, making gold cheaper for holders of other currencies. In other metals, silver jumped 6% to US$77.38/oz and platinum rose 4.2% to US$2,044.60/oz. The market also responded quickly, with oil prices reportedly falling more than 15% and risk assets strengthening.
The focus next shifts to US inflation data. Market participants await the release of the March CPI on Friday (April 10), which is expected to provide an initial indication of the impact of the surge in energy prices, with headline inflation expectations rising monthly due to higher fuel costs—a factor that could potentially influence the Federal Reserve's policy path.
Source: Newsmaker.id
