Easing Middle East tensions and lower September Fed rate hike odds lift gold, with central bank demand sustaining support above $4,000.
Gold prices rose for a third straight session, holding above $4,100 an ounce as traders priced in reduced odds of a September Federal Reserve rate hike. The probability of a Fed move slipped to 55% from 68% a day earlier, reflecting shifting expectations for U.S. monetary policy.
The advance follows reports of a potential deal to reopen the Strait of Hormuz, easing inflation concerns tied to supply disruptions. Central bank buying, including fresh purchases by the Bank of Korea, has provided structural support, while Chinese gold-backed ETF inflows signal persistent institutional demand in Asia.
Despite easing geopolitical risks, gold’s resilience above $4,000 suggests buyers view current levels as fair value amid lingering inflation and uncertainty over the Hormuz agreement’s final terms.