SINGAPORE: Spot gold rose 0.7 percent to $4,067.06 per ounce, while US gold futures increased 0.9 percent to $4,065.60 per ounce.
Oil prices fell by more than $5 a barrel at the start of trading following Trump’s decision to suspend the planned military action.
Gold had faced pressure since the beginning of the conflict between the United States and Iran, as concerns grew that war-related inflation could push central banks to raise interest rates. Although gold is traditionally considered a hedge against inflation, its appeal often weakens in a high-interest-rate environment because it does not provide interest income.
Market attention also remains focused on US monetary policy after three Federal Reserve officials who opposed the outcome of last week’s policy meeting warned that inflation could remain above the Fed’s 2 percent target unless short-term borrowing costs are increased immediately.
In other precious metals trading, spot silver gained 0.7 percent to $58.02 per ounce, while platinum rose 0.7 percent to $1,653.78 per ounce. Palladium increased 1.5 percent to $1,293 per ounce.