Global Gold Prices Jump as US-Iran Ceasefire Hopes Push Dollar and Oil Lower

KUALA LUMPUR, May 2026 — Global gold prices recorded a sharp rebound as investors responded positively to renewed optimism over a possible ceasefire extension between the United States and Iran.

During the latest trading session, spot gold rose by more than US$70 from the previous session, reaching around US$4,565.8 per ounce after briefly jumping from about US$4,503 to nearly US$4,600 per ounce, its highest level since mid-May, according to Vietnam.vn’s report citing ZNews.

US gold futures for August delivery also climbed 1.9% to US$4,618.4 per ounce, reflecting stronger demand for bullion as traders reacted to geopolitical and currency developments.

The price movement came after US President Donald Trump said he would meet in the White House Situation Room to make a final decision on a possible deal with Iran. Reports also suggested that a proposed US-Iran agreement could extend the ceasefire for another 60 days and remove restrictions on shipping through the Strait of Hormuz.

The Strait of Hormuz remains one of the world’s most important energy routes. Any sign of reopening or stabilising shipping through the strait is closely watched by oil, currency and precious metals markets because it can influence global energy prices and inflation expectations.

Gold was supported by two major factors: a weaker US dollar and lower oil prices. A softer dollar makes gold cheaper for buyers using other currencies, while falling oil prices can reduce inflation pressure and ease concerns over more aggressive monetary tightening.

Phillip Streible, chief market strategist at Blue Line Futures, said gold had bounced from a key technical support level, while optimism over the ceasefire extension pushed oil prices and the dollar lower. Reuters also reported that the dollar index was heading for a weekly decline, while oil prices were also set for a weekly fall.

However, analysts warned that gold’s recovery may still face pressure from the “higher-for-longer” interest rate outlook. If disruptions to shipping and energy infrastructure continue, oil prices could remain elevated and force the Federal Reserve to remain cautious.

Higher interest rates usually reduce the appeal of gold because

Recent inflation data has also kept investors cautious. Reuters reported that US inflation rose at its fastest pace in three years in April, driven partly by higher energy prices linked to the Iran conflict. This reinforced expectations that the Federal Reserve may keep interest rates unchanged well into next year.

The gold market has been highly volatile in recent weeks. Prices had earlier dropped to a two-month low before rebounding as traders responded to changing headlines on the US-Iran conflict, oil supply risks and the possibility of diplomatic progress.

Reuters reported that spot gold later rose 1.5% to US$4,556.84 per ounce on Friday, while US gold futures for August delivery settled 1.3% higher at US$4,593. Despite the rebound, gold was still down more than 1% for the month, showing that inflation and rate concerns continued to weigh on the market.

Other precious metals also gained during the session. Vietnam.vn reported that spot silver rose 1.2% to US$76.53 per ounce, platinum increased 1% to US$1,936.14 per ounce, and palladium climbed 0.8% to US$1,378.3 per ounce, although palladium remained down by more than 10% for the month.

The latest movement shows that gold remains highly sensitive to geopolitical headlines. Any progress in US-Iran talks could weaken oil prices and the US dollar, giving gold short-term support. However, if tensions return or inflation remains high, the Federal Reserve’s cautious stance may continue to limit bullion’s upside.

For now, investors are watching three main drivers: the outcome of US-Iran ceasefire discussions, movement in oil prices and signals from the Federal Reserve on future interest rates.

Overall, gold’s sharp rise reflects renewed market hope that a diplomatic breakthrough could ease energy supply risks and reduce inflation pressure. Still, traders remain cautious as uncertainty over the final US-Iran agreement and the Fed’s policy outlook continues to shape the direction of precious metals.