Gold was on track for its first monthly gain in five on Friday, as investors evaluated the implications of the U.S.-Iran conflict and analysed the Federal Reserve’s signals for insights on inflation and the trajectory for interest rates. Spot gold inched 0.2% lower at $4,096.29 per ounce, as of 0107, but was on track for a weekly rise of 1.1%. U.S. gold futures for August delivery gained 0.1% to $4,094.10. The metal was poised to achieve an increase exceeding 2.2% this month, marking its most significant rise since February.
Spot gold increased by 2% on Wednesday, following the Federal Reserve’s decision to keep interest rates unchanged during its most recent policy meeting, with Chairman Kevin Warsh providing minimal insight into the central bank’s forthcoming policy direction. Markets are currently reflecting a 63% probability of a rate hike in September, a decrease from approximately 80% before the policy meeting, as indicated by CME Group’s FedWatch tool. The dollar experienced an increase of approximately 0.3%, following a significant decline of 2.4% in its largest single-day drop since January 2023 on Thursday.
A drone strike on gas vessels in Egypt’s Mediterranean port of Damietta has indicated a potential new front in the U.S.-Iran conflict, heightening concerns over navigation threats through the Suez Canal, which remains one of the last viable export routes for Saudi oil. U.S. inflation decelerated in June, as the Personal Consumption Expenditures Price Index decreased by 0.1% month-over-month, marking the lowest figure since April 2020. However, this moderation is expected to be short-lived due to escalating tensions in the Middle East, which are likely to drive oil prices higher.
Global gold demand remained stable year-on-year at 1,268.9 metric tonnes in the second quarter of 2026, as central banks accelerated their purchases, compensating for a decline in investment, according to the World Gold Council’s report on Thursday. Spot silver remained unchanged at $58.98 per ounce, while platinum experienced a decline of 1.3% to $1,638.97, and palladium saw a slight decrease of 0.2% to $1,301.94.