Gold is rising globally amid increasing inflation fears and US interest rate hikes

Gold prices rose globally yesterday, as investors followed reports related to an agreement between the United States and Iran, amid growing concerns about inflation and raising US interest rates.

The price of gold in spot transactions increased 0.8% to $4,528.19 per ounce, after it had fallen to its lowest level in two months, the day before yesterday, and recorded $4,365.76 before closing trading on an upward note.

Gold also fell 2% this month, while US gold futures for August delivery rose 0.6% to $4,559.1. UBS analyst Giovanni Staunovo said: “Gold is still inversely linked to oil, which affects inflation and monetary policies,” noting that “low oil prices reduce the possibility of raising interest rates, which is a positive thing for gold.”

Inflation rose in the United States last April at the fastest pace in three years, driven by the rise in energy prices due to the Iran war, which strengthened economists’ expectations that US interest rates would remain unchanged until next year. Some experts even expected interest rates to increase by the end of this year.

Gold is a means to hedge against inflation, but it is exposed to pressure as interest rates rise because it does not generate a return.

Rotbart & Co, a precious metals trading company, said in a note to traders: “Trading in May 2026 was characterized by movement in a limited range in global markets, after witnessing fluctuations and turmoil in the first quarter,” adding: “There is still an impact on sentiment from geopolitical tension and inflation fears, but the decline in demand for safe havens and expectations of raising interest rates put pressure on precious metals during the month.”

As for other precious metals, silver fell in spot transactions 0.2% to $75.51 per ounce, while platinum fell 0.3% to $1917.96, while palladium rose 0.4% to $1373.88.