Gold Gains Fourth Straight Week Amid Fed Rate Cut Signals and Middle East Truce in Focus
Key Takeaways:
The three-day net gain from the April 16 close of approximately $4,790 to Sunday’s price stood at roughly $41, or 0.85%. The bulk of that move was built during Friday’s session, when intraday momentum in futures and spot ran between 1% and 1.5%.
The primary driver over the three-day window was Iran’s announcement that the Strait of Hormuz was open for commercial shipping during a 10-day truce period tied to Israel-Lebanon ceasefire progress. That news sent oil prices sharply lower by more than 10% at certain points during the week, which in turn, helped pull near-term inflation expectations down and put pressure on the U.S. dollar.
Then Iran shut the Strait of Hormuz down again, blaming the U.S. blockade. Trump has not been pleased about the latest situation, particularly the reports of Iran firing at commercial vessels, and he released a warning on Truth Social Sunday. Trump insists Iran did not close the waterway, stressing it was really the U.S. blockade.
“Iran recently announced that they were closing the Strait, which is strange, because our BLOCKADE has already closed it. They’re helping us without knowing,” Trump claimed.
The unsettled debate concerning the Strait and weaker dollar has made dollar-denominated gold less expensive for buyers holding other currencies, which tends to lift demand. International buyers responded accordingly on Friday with the soft dollar and volatility on hand.
Federal Reserve signals also fed into the U.S. dollar’s latest retreat. Markets continued pricing in rate-cut expectations while watching upcoming U.S. economic data, including retail sales figures and purchasing managers index readings.
Amid the uncertainty in the Middle East, gold extended its gains through Friday rather than pulling back. Traders weighed the truce against continued risk in the region, and safe-haven demand held.
Of course, gold bug and economist, Peter Schiff, believes the “best asset to buy is gold” during these times. Schiff noted on X, before Iran shut the Strait down again, that “even if peace talks fail and the war resumes, eventually gold will break from the trend of falling when war escalates and rise no matter what.”
The fourth consecutive weekly gain placed gold firmly in an established uptrend on longer timeframes, though the weekend session has shown standard consolidation behavior typical of thin liquidity conditions. For now, gold enters the new week with Trump’s latest warning and the uncertainty tied to the Middle East waterway.
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