Gold Price Rises - Investors Assess US-Iran Agreement and Fed Signals

Gold prices rose on Thursday, recovering part of the previous session's losses. Spot gold prices increased by 0.3% and reached $4,269.42 per ounce, while gold futures declined by 2.1% and settled at $4,288.72.

In the previous trading session, gold fell by 1.7%, driven by the strengthening of the US dollar and rising government bond yields. These developments followed the Federal Reserve's latest decision.

Market sentiment was positively affected by a temporary agreement reached between the United States and Iran, which provides for a reduction of tensions in the Middle East and a phased opening of the Strait of Hormuz. Under the framework of a 14-point memorandum, Iran will ensure free passage of ships through the strait during a 60-day negotiation period, while movement should be fully restored over the following 30 days.

The agreement reduced concerns about a global energy supply crisis and inflation driven by energy resources, which maintains interest in gold as a risk hedging instrument.

Nevertheless, the growth in gold prices is constrained by the position of the US Federal Reserve. The central bank left the interest rate unchanged in the range of 3.50%-3.75%, but indicated that further monetary policy tightening is possible later this year.

According to updated forecasts, 9 of the Fed's 19 members expect at least one interest rate increase in 2026. The Fed's new chairman, Kevin Warsh, also confirmed that fighting inflation remains the central bank's top priority.

A stronger dollar and higher interest rates are typically negative factors for gold, as they reduce the attractiveness of investing in non-interest-bearing assets.