Gold Surges to Three-Week High as Ceasefire Weakens Dollar and Boosts Metals

Gold prices climbed sharply to a three-week high as the Donald Trump-led decision to pause military action against Iran eased geopolitical tensions and pressured the U.S. dollar.

Spot gold jumped 2.7% to $4,832.51 per ounce, while U.S. gold futures rose to $4,857.25, supported by a softer dollar and renewed investor demand for bullion. The US Dollar Index fell nearly 1%, making gold more attractive for holders of other currencies.

The ceasefire agreement, brokered with mediation efforts led by Pakistan, hinges on the reopening of the Strait of Hormuz—a critical global oil route responsible for about 20% of supply. Iran signaled conditional cooperation, further calming markets.

Precious metals rallied broadly, with silver surging 6% and platinum gaining over 4%, reflecting increased appetite for alternative stores of value. Meanwhile, oil prices plunged more than 15% as fears of prolonged supply disruption eased.

The market now shifts focus to upcoming U.S. inflation data, which could shape the outlook for Federal Reserve policy. Rising fuel costs are expected to push inflation higher, potentially complicating interest rate decisions in the coming months.

Industrial metals also advanced, with copper prices rising across both London and U.S. markets, signaling optimism around global demand recovery despite recent geopolitical volatility.