Gold rose more than 1% on Monday as a
pause in Middle East hostilities sent oil prices lower,
alleviating some inflation concerns, while investors awaited the
U.S. Federal Reserve’s policy decision.
Spot gold rose 1.4% to $4,110.56 per ounce by 0200
GMT. U.S. gold futures gained 1% to $4,112.10.
“Gold is a clear beneficiary today of the dual price action
in oil and the U.S. dollar, both of which have dropped on
de-escalation hopes between the U.S. and Iran. Lower oil is
easing inflation concerns,” said Tim Waterer, chief market
analyst at KCM Trade.
The U.S. dollar index was down 0.3%, making
greenback-priced metals more affordable for other currency
holders.
Iran will halt its own attacks as long as the United States
does the same, a senior Iranian official told Reuters on Sunday.
The development comes as the United States pressed pause on its
bombing campaign after President Donald Trump’s advisers told
him they were running out of targets and expressed worries about
depleting the U.S. arsenal.
Oil prices were down more than 4% for the day.
Since the conflict began earlier this year, oil prices have
gained, driving inflation concerns and expectations of central
bank rate hikes. This has weighed on gold, which, despite
traditionally being seen as an inflation hedge, becomes less
attractive as higher rates raise the opportunity cost of holding
the non-yielding metal.
“Longer term, I remain constructively bullish on gold.
Gold’s immediate fate is closely tied to where oil prices head
from here and the path higher is likely to remain volatile and
heavily influenced by geopolitical headlines until a more
durable peace takes hold,” Waterer added.
Market focus is also on the Federal Reserve policy meeting
this week, where investors and economists widely expect rates to
be kept unchanged. Traders are pricing in about an 80% chance of
a hike in September, according to the CME FedWatch Tool
Among other metals, spot silver rose 2.8% to $59.81
per ounce, platinum climbed 2.6% to $1,629.15 and
palladium jumped 2.1% to $1,269.43.
Published on July 27, 2026
