Gold Gains as US-Iran Pause Also Sends Oil Prices Lower

Gold climbed more than one percent in Asian trading Monday. A weekend pause in US-Iran hostilities pushed oil prices lower and eased fears of prolonged high interest rates.

Spot gold traded at $4,106.65 per ounce Monday, up 1.33% on the day, according to TradingView data.

Oil Retreat Lifts Precious Metals

The pause came as advisers reportedly warned Trump that the military was nearing the limit of viable targets in Iran. They also flagged concerns about draining U.S. munitions stockpiles, prompting the pause in strikes. Iran will halt its own attacks as long as Washington does the same, a senior Iranian official told Reuters.

Oil prices tumbled as much as 7% on hopes for a diplomatic resolution. That reverses recent forecasts that Brent crude could revisit its war-era peak near $120 after going above $100 at the weekend. Lower energy costs typically ease inflation, reducing the odds the Fed holds rates high for longer. Gold's appeal fades when rates stay high since the metal pays no yield.

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