Gold gains as oil slumps after Trump holds off on Iran attack

Gold rose on Monday as oil prices tumbled after US President Donald Trump held off on a fresh attack on Iran in hopes of ​a swift deal, slightly easing concerns about inflation and higher interest rates.

Spot ‌gold was up 0.7% at $4,067.06 per ounce, as of 0023 GMT. U.S. gold futures rose 0.9% to $4,065.60.

Trump said late on Saturday on his Truth Social platform that Iran and other ​Middle Eastern countries had asked for time to complete a deal that ​would lead to “the Immediate, Complete and Total” reopening of the ⁠Strait of Hormuz and “an end to Iran’s nuclear threat”.

Oil prices fell more than $5 ​a barrel at Monday’s open.

Gold has come under pressure since the start of the ​U.S.-Iran conflict, as a war-driven rise in inflation could prompt central banks to raise interest rates. Although bullion is traditionally viewed as a hedge against inflation, its appeal tends to ​diminish in a high-interest-rate environment because it does not yield interest.

Three Federal Reserve officials ​who dissented at last week’s policy meeting in favour of an interest rate hike expressed concern ‌on ⁠Friday that without an immediate increase in short-term borrowing costs, inflation will stay stuck above the Fed’s 2% target, where it has been for more than five years.

Market participants will also focus on a slew of U.S. jobs reports due ​this week, including ​job openings data, ⁠the ADP employment report, weekly jobless claims and the nonfarm payrolls report.

Spot silver gained 0.7% to $58.02 per ounce, platinum climbed ​0.7% to $1,653.78, and palladium firmed 1.5% to $1,293.00.

Russia’s Norilsk Nickel, the ​world’s largest ⁠palladium producer, reported on Friday that its revenue and net profit in the first six months had sharply increased.