Gold prices climbed sharply, holding gains near $4,260 an ounce, as markets digested signs of a diplomatic breakthrough regarding the reopening of the Strait of Hormuz.
The precious metal posted a 4.1% jump, marking a significant repricing of geopolitical risk premiums that have weighed on global trade routes for weeks.
This development marks a pivot from recent volatility, where gold had stabilized around $4,050 as investors weighed conflicting signals from Washington and Tehran.
The rally in bullion was driven by a dual mechanism: reduced immediate supply risk for energy and a subsequent shift in monetary policy expectations.
With the Strait of Hormuz critical for global oil flows, any progress toward restoring normal shipping operations directly lowers the probability of an energy-led inflation spike.
Traders are now pricing in a lower likelihood that the Federal Reserve will be forced to raise interest rates to combat oil-driven price pressures.
This development marks a pivot from recent volatility, where gold had stabilized around $4,050 as investors weighed conflicting signals from Washington and Tehran.