BENGALURU, March 25, 2026, 18:38 IST
- Spot gold jumped 2.4%, reaching $4,582.18 an ounce by 1141 GMT, after oil slipped over 5% on optimism around a ceasefire.
- Markets moved higher on reports the U.S. floated a 15-point proposal to Iran—despite Tehran’s public denial that any talks are underway.
- Goldman Sachs is calling for $5,400 on gold by end-2026—lower than UBS at $5,900, and well under JPMorgan’s $6,300 prediction.
Gold snapped higher by more than 2% Wednesday, clawing its way back after hitting a four-month trough. Hints of potential U.S.-Iran talks sent oil tumbling, easing some pressure from inflation worries. Spot gold—considered the industry’s cash reference—rose 2.4% to $4,582.18 an ounce as of 1141 GMT. April U.S. futures fared even better, adding 4.1% to $4,581.60.
This shift is notable—bullion isn’t just acting as a basic war hedge anymore. Lately, price action has mirrored sentiment around oil, inflation, and rates. When crude rises, central banks tend to stick with tighter policy, which weighs on gold since it doesn’t yield any income.
After Reuters broke news that Pakistan had relayed a U.S. proposal to Iran—and that either Pakistan or Turkey might host negotiations—sentiment shifted. Bloomberg added that Washington and regional intermediaries were looking at arranging high-level talks, possibly as early as Thursday. Traders zeroed in on reports circulating about a 15-point U.S. plan and the potential for a one-month ceasefire.
The signals weren’t exactly clear. Iran’s military dismissed U.S. efforts, claiming Washington was just talking to itself, and the strikes didn’t stop. Still, oil dipped and the dollar slipped. “With crude oil having eased on ceasefire hopes, this has allowed the U.S. dollar to ease back, providing mild support for gold,” said Fawad Razaqzada of City Index and FOREX.com. Reuters
Cheaper oil swiftly pushed rate expectations lower. According to Reuters, traders now see just a 16% chance of a Fed rate hike by December, down from 25% a week ago. Fed Governor Michael Barr, though, indicated rates might stay put for a while yet. Silver gained 2.8%, platinum added 1.8%, and palladium was up 1.6%.
Wednesday’s rebound barely puts a dent in losses. Gold remains almost 20% under its Jan. 29 peak of $5,594.82. Earlier this week, Reuters said the metal was still 15% below where it stood when the Iran conflict broke out on Feb. 28. “Gold should do well in a stagflationary environment,” noted John Reade, senior market strategist at the World Gold Council, but he flagged that forced selling can take over right after a shock. Reuters
Long-range bulls haven’t gone away. Back in January, Goldman Sachs bumped its end-2026 gold forecast up to $5,400 per ounce, pointing to steady central-bank purchases—around 60 metric tons monthly—and private investors looking to diversify. UBS followed with its own 2026 year-end target: $5,900. JPMorgan expects even more, calling for $6,300.
The bounce might not last if diplomatic efforts lose traction or oil prices spike again. The Strait of Hormuz is still largely shut to most shipping, and Amundi’s Amelie Derambure put it this way: right now, traders are chasing “the idea that peace talks or a ceasefire could be on the way,” fueling a short-lived rally off promising headlines. But without solid proof, she said, it’s hard to see the move holding. Reuters
