Gold Edges Higher on Iran Hopes
Gold climbed above $4,500 on Wednesday, marking a second straight session of gains as hopes for an end to the prolonged Middle East conflict grew on reports that the US was pursuing talks with Iran. Israeli media indicated that Washington was seeking a one-month ceasefire to enable negotiations, while the New York Times reported that the US had sent Iran a 15-point proposal to resolve the conflict. This raised optimism even after President Donald Trump ordered the deployment of about 2,000 troops to the region, as the administration weighed options to ease Iran’s control over the Strait of Hormuz. Gold has plunged as much as 25% from its March peak as elevated energy prices driven by the Iran war fueled inflation concerns and strengthened expectations that major central banks may raise interest rates this year. Federal Reserve Governor Michael Barr said the central bank may need to keep rates elevated for some time to address inflation.