Gold Extends Gain as Hormuz Deal Progress Lowers Rate-Hike Odds

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessGold Extends Gain as Hormuz Deal Progress Lowers Rate-Hike OddsGold extended the biggest gain in six months as signs of progress in reopening the Strait of Hormuz eased energy-led pressure on the Federal Reserve to raise interest rates.Author of the article: You can save this article by registering for free here. Or sign-in if you have an account.norzjoaq7{gzryzc8aaq)4]r_media_dl_1.png Bloomberg(Bloomberg) — Gold extended the biggest gain in six months as signs of progress in reopening the Strait of Hormuz eased energy-led pressure on the Federal Reserve to raise interest rates.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountBullion rose as much as 0.8% to around $4,280 an ounce, after jumping 4.1% in the previous session, the biggest rise since Feb. 3. Iran said it has reached agreement with Oman on a proposed shipping route through the strait, raising the prospect of some energy flows resuming through the critical waterway. Oil fell.The route would be temporary and remain active for “two to four months,” Iranian Deputy Foreign Minister Kazem Gharibabadi told domestic media, adding that “this understanding does not mean the full reopening” of the strait. Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againPresident Donald Trump said the US’s negotiations with Iran were ongoing and he will “see what happens,” adding he would prefer to make a deal with the Islamic Republic than end the war militarily. Earlier, he said a deal was possible as early as Wednesday US time.Signs of progress in ending the more than five-month conflict has markets now fully pricing in only a single US rate increase by year-end, down from two as recently as last week. Less monetary tightening is generally positive for precious metals including gold, which generate no yield.However, Fed Governor Lisa Cook repeated on Wednesday that she is ready to raise rates if inflation doesn’t slow, warning the central bank may not have the luxury of waiting before it returns to its 2% target. Despite backing the decision to hold rates steady at the Fed’s July policy meeting, she cautioned that the longer inflation remained above the goal, the tougher it would be to rein it in.Gold has fallen by nearly a fifth since the US-Iran war began in late February. The conflict sent energy prices soaring, stoked inflationary pressures and raised the likelihood that rates will stay higher for longer. “Macro headwinds being pushed out on the horizon, along with US-Iran deal hope, have put some major wind in the precious metals’ sails,” TD Securities analysts including Ryan McKay wrote in a note. “Macro discretionary funds have more than doubled their positions since June,” they added, building on support from top funds on the Shanghai Futures Exchange and inflows to gold-backed exchange-traded funds in Asia.However, gold’s challenge is not entirely over, the analysts said, noting: “A still extremely tight energy market will remain a major hurdle for a renewed bull run.”Separately, the Bank of Korea announced it is working with domestic producers, the Korea Exchange and the Korea Securities Depository to establish a framework to purchase gold refined in South Korea. The move would mark the bank’s first purchase of domestically produced gold, which local producers would otherwise export, since 1967.Spot gold climbed 0.7% to $4,277.41 an ounce as of 8 a.m. in Singapore. Silver rose 0.3% to $62.23 an ounce, after jumping more than 4% in the previous session. Platinum and palladium also advanced. The Bloomberg Dollar Spot Index, a gauge of the US currency, edged lower after ending Wednesday down 0.2%.—With assistance from Wendy Wells.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.