Gold prices rose in Asian trade on Wednesday, recovering from a one-week low after the U.S. indefinitely extended a ceasefire with Iran, although markets still remained unclear on future peace talks.
The yellow metal was nursing losses from the prior session after Federal Reserve Chair nominee Kevin Warsh said he made no promises to President Donald Trump that he will cut interest rates if confirmed.
Spot gold rose 0.9% to $4,763.66 an ounce, while gold futures rose 1.3% to $4,782.21/oz by 02:45 ET (06:45 GMT). Spot prices remained squarely within a $4,700-$4,900/oz trading range seen over the past two weeks.
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Other precious metals also rebounded on Wednesday. Spot silver rose 2.4% to $78.5335/oz, while spot platinum rose 2.3% to $2,087.15/oz.
Iran peace talks uncertain after ceasefire extension Trump on Tuesday announced an indefinite extension in the Iran ceasefire, allowing for more peace talks between Washington and Tehran.
While the Iran ceasefire extension provided some relief, the status of future peace talks remained largely uncertain. Potential negotiations between the U.S. and Iran, which were expected to take place on Tuesday, fell through at the eleventh hour.
Trump said a naval blockade against Iran will remain, drawing ire from Iranian officials, who called it an “act of war.”
Gold has struggled since the onset of the Iran war, as safe haven demand was largely overshadowed by concerns over the war’s inflationary impact.
The metal has behaved more like a risk-driven asset since the onset of the war in late-February, moving almost in tandem with stocks in response to developments in the conflict.
Warsh says no commitment to cut rates, flags policy overhaul Precious metal prices were also pressured by strength in the dollar on Tuesday, as the greenback firmed tracking Warsh’s testimony.
Warsh emphasized on the Fed’s independence from politics, but also flagged a major policy overhaul at the central bank if confirmed as its chair.
Warsh– a former Fed governor– was seen as a less dovish pick than markets were expecting. His nomination had triggered deep losses in gold and precious metals in late-January.
But while his confirmation appeared likely, the timing of his appointment remained wholly uncertain. Key Republican leaders have opposed Warsh’s confirmation until the Trump administration drops an ongoing probe into current Fed Chair Jerome Powell.
Powell is expected to stay on past the end of his term on May 15, especially if Congress delays Warsh’s confirmation.
