Global gold prices saw a significant rise on the morning of 15/6, with spot gold climbing nearly 100 USD to reach 4,309 USD per ounce. The precious metal is currently trading around 4,283 USD an ounce.
This market surge follows news of a peace agreement between the United States and Iran. United States President Donald Trump announced the immediate lifting of the United States' maritime blockade on Iran, along with the reopening of the Strait of Hormuz "without transit fees." Pakistan Prime Minister Shehbaz Sharif confirmed that both nations would "immediately and permanently" cease all military activities. The agreement is set to be signed in Switzerland on 19/6.
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Global gold prices surged on the morning of 15/6. *Chart: Kitco* |
Gold prices had been under pressure since the Middle East conflict began in late February. The conflict drove up oil prices, fueling inflation risks and subsequent interest rate hikes. This made gold, which offers no fixed interest, less attractive to investors.
Beyond gold, other precious metals are also experiencing upward momentum. Silver prices briefly increased by nearly 3% this morning, surpassing 70 USD per ounce. Platinum and palladium registered similar gains.
Conversely, in the crude oil market, prices dropped over 4% following the developments in the Middle East. Brent crude is now priced at 83,6 USD per barrel, while West Texas Intermediate (WTI) trades at 81 USD per barrel.
Iran's prior blockade of the Strait of Hormuz – a vital maritime route for approximately 20% of global crude oil and liquefied natural gas shipments – coupled with attacks on several energy production facilities in the Middle East, caused a record three-month supply disruption worldwide. Before the conflict, Brent crude oil traded at around 70 USD per barrel.
Investors are now awaiting further signals from this week's Federal Reserve (Fed) meeting. The CME FedWatch tool indicated late last week that investors are anticipating an over 60% probability of a Fed rate hike in December. Higher interest rates typically diminish the appeal of precious metals.
Ha Thu (according to Reuters, Kitco)
