Gold held onto its gains after reports surfaced of a tentative US-Iran agreement that could extend the fragile ceasefire between the two nations. The deal, reportedly struck on May 28, hinges on Iran removing mines from the Strait of Hormuz within 30 days in exchange for the US lifting its naval blockade.
The metal was trading near $4,700 per ounce in late May, a level that reflects cautious optimism rather than panic. For context, gold had fallen over 10% from its highs after the US-Iran conflict erupted on February 28, as surging oil prices stoked inflation fears that made even the classic safe haven look wobbly.
From conflict to cautious calm
When the US-Iran conflict kicked off in late February, the initial reaction wasn’t a rush into bullion. It was a selloff. Rising oil prices triggered inflation concerns, and inflation, or at least the expectation of aggressive central bank responses to it, can be kryptonite for gold.
That changed in early April. An initial two-week ceasefire announced around April 7-8 sent gold spiking above $4,800 per ounce. Bitcoin, never one to miss a party, surged past $72,000 during the same window.
