Gold jumps on weaker dollar, Middle East peace hopes
- By Reuters -
- May 06, 2026
Gold prices rose 2% on Wednesday, buoyed by a weaker dollar, while softer oil prices eased fears of inflation and higher-for-longer interest rates, amid hopes of a U.S.-Iran peace deal.
Spot gold was up 2% at $4,647.09 per ounce, as of 0415 GMT. U.S. gold futures for June delivery rose 2% to $4,658.
US President Donald Trump said on Tuesday he would briefly pause an operation to help escort ships through the Strait of Hormuz, citing progress toward a comprehensive agreement with Iran.
Gold gained as “oil prices retreated on reduction in geopolitical risk premium, after the US confirmed that the ongoing fragile ceasefire between Iran is still intact, despite the skirmish that was seen at the start of this week,” said Kelvin Wong, a senior market analyst at OANDA.
The US dollar and crude oil prices eased after Trump indicated that a possible peace deal may be reached to end the war with Iran.
US Secretary of State Marco Rubio told reporters on Tuesday that “operation Epic Fury is concluded,” adding that “we’re not cheering for an additional situation to occur.”
“Any signs of re-escalation of tension between the two of them, you will see gold prices seeing some form of profit-taking, or for short-term speculators to unwind their near-term net long position in gold,” Wong said.
A weaker U.S. currency makes dollar-priced metals cheaper for holders of other currencies.
Elevated crude oil prices can stoke inflation, increasing the likelihood of higher interest rates. While gold is considered an inflation hedge, high interest rates make yield-bearing assets more attractive, weighing on its appeal.
Investors await the U.S. non-farm payrolls release later this week, which will test whether the economy remains resilient enough to keep the Federal Reserve’s monetary policy on hold.
Spot silver rose 3.4% to $75.62 per ounce, platinum gained 2.4% to $1,999.95, and palladium was up 2.6% at $1,524.59.