Why are gold and silver prices up today, and will precious metals continue to rise or fall again? Gold rebounds after Iran-US ceasefire extension talks

Gold prices rebounded over 1% on Thursday, reaching $4,504.07 per ounce by early afternoon US trading, after earlier hitting their lowest level in nearly two months. The rally followed reports that the United States and Iran had agreed to a 60-day ceasefire extension, pending approval from President Donald Trump. The news eased pressure on global markets, causing Brent crude prices to fall and the US dollar index to drop 0.2%, which typically boosts gold demand as it becomes cheaper for foreign buyers. Silver prices also rose, gaining 1.3% to $75.60, as investors reacted to multiple factors. Softer-than-expected US inflation data—with the personal consumption expenditures (PCE) index rising 3.8% year-over-year and 0.4% monthly—reduced expectations of aggressive Federal Reserve rate hikes. A weaker dollar further supported precious metals, while China’s gold imports through Hong Kong surged in April, adding to market demand. Analysts noted that gold had nearly fallen below its 200-day moving average earlier in the session, a key technical level for bullish trends. Tai Wong, an independent metals trader, attributed the recovery to weaker inflation data and progress on geopolitical tensions, including developments related to the Strait of Hormuz. Bart Melek, global head of commodity strategy at TD Securities, suggested the Fed may pause rate hikes, which would benefit gold as higher interest rates typically suppress its price. Despite the recovery, precious metals remain vulnerable to interest rate movements and geopolitical risks. Federal Reserve meeting minutes from late April indicated some officials still favor additional rate hikes if inflation persists. Gold’s safe-haven status has kept it in demand amid conflicts, but its performance hinges on whether the US-Iran ceasefire holds and whether the Fed maintains a hawkish stance. Chinese demand continues to play a critical role, with April import data showing a sharp increase in gold purchases through Hong Kong. The combination of geopolitical easing, softer inflation expectations, and strong Asian demand has temporarily stabilized prices, though analysts warn markets could shift rapidly if tensions flare or the Fed adopts a more aggressive monetary policy.