Gold Holds Rebound Near $4,385 as Trump Signals Brief Iran Conflict

Gold held onto its rebound as President Donald Trump’s comments reduced concerns that the US military operation in the Middle East would become a prolonged conflict, while expectations for additional US rate hikes weakened.

Spot gold traded around $4,385 an ounce in Singapore on September 2, Bloomberg reported. As of 7:56 a.m., it was up 0.1% from the previous session at $4,386.94. Bullion rose 1% a day earlier, snapping a three-session losing streak.

Trump recently said attacks on Iran would not last long, helping cool gains in crude prices. Renewed fighting between the US and Iran had fueled worries about a prolonged war and inflation driven by a surge in energy costs. Some of those concerns eased after Trump’s remarks.

A weaker dollar also supported gold. The yen jumped a day earlier, drawing attention to the possibility of additional steps by Japanese authorities to support the currency, and the dollar fell. A softer dollar typically makes gold cheaper for investors holding other currencies.

Expectations for further US rate hikes also ebbed. John Williams, president of the Federal Reserve Bank of New York, said there were signs inflation continued to cool as the impact of tariffs on prices eased. He added that higher energy costs were not spreading broadly into other service prices.

Slower growth in US private-sector employment last month also lowered expectations for higher rates. Fed Chair Kevin Warsh had sharply boosted expectations for a rate increase this month after signaling in a Jackson Hole speech last week that further tightening remained possible to contain inflation.

Meanwhile, spot silver rose 0.1% to $65.38 an ounce. Platinum and palladium were little changed, while the Bloomberg Dollar Spot Index was steady after falling 0.2% a day earlier.