By: Economy Middle east

Gold prices climbed to a three-week peak during Wednesday’s Asian trading session as the U.S. dollar softened. This followed President Donald Trump’s agreement to a two-week ceasefire with Iran, which prevented scheduled attacks on that nation’s civilian infrastructure.

Spot gold increased 2.5 percent to reach $4,821.48 per ounce by 04:38 UAE time, marking its most significant peak since March 19. Simultaneously, U.S. gold futures rose 2.5 percent to $4,849.25 per ounce. At present, spot gold is valued at $4,801.58, and U.S. gold futures are priced at $4,830.57.

In the UAE, gold rates saw a significant increase. The rate for 24K gold rose AED11.25 to AED577.50, while 22K gold grew by AED10.50 to AED534.75. Furthermore, 21K gold went up AED10.00 to AED512.75, 18K gold climbed AED8.75 to AED439.50, and 14K gold increased AED6.75 to AED342.75.

Regarding other precious metals, silver prices surged 6.45 percent to $76.53 per ounce, and platinum appreciated 3.72 percent to $2,039.45/oz.

Mediating strategic maritime truces

Through a social media update, Trump confirmed he would pause military operations against Iran for a fortnight. This declaration was made less than two hours before the 8:00 p.m. ET deadline, a moment investors viewed as a critical threshold for potential conflict escalation.

The truce, mediated by Pakistan following urgent diplomatic talks, depends on Iran guaranteeing the secure reopening of the Strait of Hormuz, a vital passage for approximately 20 percent of global oil transit. Iran indicated a parallel desire to lower tensions, stating that safe transit through the Strait is possible during the ceasefire, provided that combat ends and maritime vessels coordinate with Iranian officials.

Financial markets responded rapidly; oil prices dropped by more than 15 percent and risk-sensitive assets improved, while the dollar faced selling pressure. The US Dollar Index declined by nearly 1 percent during Wednesday’s Asian trade, reducing the cost of bullion for buyers using alternative currencies.

Although gold is typically viewed as a safe-haven, it faced headwinds last month when rising oil costs fueled inflation worries and prompted speculation that the U.S. Federal Reserve might maintain elevated interest rates for an extended period. Investors are now focused on the U.S. March consumer price index (CPI) data scheduled for Friday, which should reveal the initial effects of the recent spike in energy costs.