Spot gold traded in a narrow range during Wednesday's Asian session as an interim deal on the Strait of Hormuz appeared closer, easing inflation worries and reducing expectations for Fed rate hikes. Qatar said it drafted a proposal to normalize commercial shipping through the strait, while US and Iranian officials reported progress in talks. Oil fell for a third day on the optimism. Markets now fully price one US rate increase this year, down from nearly two last week. Looser monetary policy tends to support non-yielding gold.
Spot gold held a narrow range during Wednesday's Asian session, with an interim agreement on the Strait of Hormuz looking more likely. That development eased inflation concerns and trimmed expectations for additional Federal Reserve rate hikes.
Qatar said it has drafted a proposal to help normalize commercial shipping through the strait. US and Iranian officials both indicated progress in negotiations to reopen the key energy shipping waterway. Oil prices declined for a third straight session on optimism that a deal may be reached.
Money markets now fully price one rate increase by the Fed this year, compared with nearly two hikes priced just last week. Reduced monetary tightening generally supports non-yielding gold, which does not pay interest or dividends.
Nicky Shiels, head of research and metals strategy at MKS Pamp, said gold acts as a liquidity sponge in the macro commodity complex. "If there is any tightening risk signal, whether structural or headline-driven, gold is among the first assets to feel the shock," she said. Jinshi reported.
This article was originally published by Bit.Fan. For more cryptocurrency news and market insights, visit www.bit.fan. Disclaimer:
The market information, project data, and third-party content displayed on this platform are for industry information sharing only and do not constitute any form of investment advice or return commitment.
Cryptocurrency trading carries high risks. Users should fully assess their risk tolerance and make independent decisions. All profits, losses, and legal responsibilities are borne by the users themselves.
