Gold experienced an increase of over 1% on Monday, recovering from a low that persisted for more than a week in the prior session. This uptick occurred as Brent crude oil prices declined following Iran’s announcement of advancements in U.S.-Iran peace negotiations, which alleviated worries regarding inflation and the potential for elevated interest rates. Spot gold increased by 1.2% to $4,209.03 per ounce, as of 0112. U.S. gold futures for August delivery declined by 0.5% to $4,225.80. An Iranian foreign ministry spokesperson indicated that significant progress has been achieved during the quadrilateral discussions in Switzerland, as reported.
Iran-U.S. peace talks in Switzerland extended into their second day on Monday, following a fraught opening characterised by Tehran’s declaration of the closure of the Strait of Hormuz and U.S. President Donald Trump’s reiteration of threats to recommence military actions against Iran. Brent crude futures declined by 0.5% following Iran’s announcement of advancements in peace negotiations, which alleviated concerns regarding persistent inflation and the prospect of prolonged elevated global interest rates. Federal Reserve Chair Kevin Warsh’s focus on inflation during last week’s conference, coupled with a lack of more nuanced commentary regarding the criteria for a rate hike, prompted investors to anticipate an imminent increase and subsequently drive up bond yields.
Most global brokerages are anticipating that the Fed will maintain interest rates at their current levels for the remainder of 2026, a shift from earlier expectations of two interest rate cuts at the beginning of the year, as policymakers contend with persistent inflation risks and a robust labour market. Gold demand in India experienced a modest uptick last week as prices declined to their lowest point in two-and-a-half months, exhibiting volatility. Meanwhile, the leading consumer, China, transitioned to a discount.
Swiss gold exports experienced a decline of 9% in May compared to the preceding month, as reduced shipments to India and Hong Kong counterbalanced increased deliveries to Britain and China, according to data from Swiss customs. Spot silver rose 2.6% to $66.60 per ounce, platinum gained 1.3% to $1,684.85, and palladium was up 1.5% at $1,276.88.