Gold wavers as traders weigh Fed rate outlook, US-Iran talks

Published Tue, Aug 4, 2026 · 07:45 AM

GOLD fluctuated as traders weighed the Federal Reserve’s interest-rate path after cooling tensions in the Middle East eased energy-driven inflation. 

Bullion traded around US$4,050 an ounce, having seen out July with a 1 per cent gain – its first monthly increase since February.

US President Donald Trump said new Iran talks would begin on Monday (Aug 3) afternoon after he called off a planned attack on Iran partially in response to pleas from US allies in the Middle East, including Saudi Arabia.

US crude slid to settle near US$80 a barrel, while Treasury yields fell. 

“The environment is a little bit better in terms of support for gold right now after the Fed meeting,” Samantha Dart, co-head of global commodities research at Goldman Sachs, told Bloomberg News.

Fears of higher interest rates increase the opportunity cost of holding gold and prompt investors to reduce holdings, she said. “Tactically, we are not totally out of the woods yet,” she added.

Gold is down by more than a fifth since the US-Iran war began more than five months ago, with high energy prices stoking inflationary pressures and raising the likelihood that interest rates will stay higher for longer – a headwind for precious metals, which do not pay interest. 

Bullion received a “second relief card” and is consolidating “after Trump delayed strikes on Iran over the weekend” and “following the soft hawkish tone” from the Fed last week, Ahmad Assiri, market strategist at Pepperstone Group, said in a note.

“Iran-related turbulence is likely to move the needle to the downside during the week if regional diplomacy doesn’t result in a positive outcome,” he added.

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Spot gold edged down 0.2 per cent to US$4,054.95 an ounce as of 3.52 pm in New York. Silver gained 0.9 per cent to US$58.12 an ounce. Platinum and palladium fell.

The Bloomberg Dollar Spot Index, a gauge of the US currency, was flat. BLOOMBERG