Gold Poised to Break Nine-Week Winning Run

Gold climbed to $4,150 an ounce on Wednesday, touching its highest level since July 7, supported by safe-haven demand and technical buying as investors monitored escalating Middle East tensions and awaited next week's Federal Reserve meeting for clues on the US interest rate outlook. Geopolitical risks intensified after President Donald Trump warned of further strikes on Iran and pledged retaliation if Iran-backed Houthi rebels disrupt shipping through the Red Sea. Meanwhile, Secretary of State Marco Rubio said the US remains open to a deal with Iran but questioned whether Tehran is willing to reach acceptable terms. Still, gold remained below the record highs reached in January, as elevated oil prices have fueled inflation concerns and strengthened expectations that interest rates will stay higher for longer. Markets continue to price in two 25-basis-point rate hikes by March 2027, with a 70% chance of the first increase coming as early as September.

Gold climbed above $4,100 an ounce on Wednesday, extending gains from the previous session as investors continued to monitor Middle East uncertainties and rising oil prices and their impact on inflation and interest rates. President Donald Trump downplayed the chances of near-term talks with Iran and warned of additional strikes, lifting oil prices. Iran-backed Houthi rebels in Yemen also disrupted shipping through the Red Sea, while a series of attacks on the Caspian Pipeline Consortium terminal along Russia’s Black Sea coast added to supply concerns. Meanwhile, ADP data showed US private employers added an average of 16,500 jobs per week over the four weeks ending July 4, down from an average weekly gain of 19,250 in the prior four-week period, marking a fourth straight slowdown in hiring. Markets widely expect the Federal Reserve to leave interest rates unchanged at next week’s meeting, while pricing in more than a 55% chance of a rate hike in September.

Gold rose more than 1% to $4,070 an ounce on Tuesday as investors weighed diplomatic efforts to de-escalate the US-Iran conflict and their potential impact on oil prices, inflation risks, and the Federal Reserve’s interest rate outlook. Reports indicated that mediators are working to bring Washington and Tehran back to the negotiating table, with discussions reportedly including a possible 10-day truce aimed at securing shipping routes through the Strait of Hormuz. The recent escalation in the conflict pushed oil prices to a more than one-month high, raising concerns that higher energy costs could reinforce inflationary pressures. This has prompted a growing number of US policymakers to argue that interest rates may need to remain higher for longer, or potentially rise, to contain inflation. While the Fed is widely expected to keep rates unchanged at next week’s meeting, markets are pricing in more than a 60% probability of a rate hike in September.