Gold prices surged above $4,800 as market sentiment now attracts some buying after US President Donald Trump agreed to halt attacks on Iran for two weeks.
At 9 am, gold prices were at $4,812, up 2.32% since it opened in early trading Wednesday in the Asian session.
Donald Trump revealed that the United States has agreed to implement a two-week ceasefire with Iran, with the main condition being that the country reopens the Strait of Hormuz, a critical route for global oil trade.
White House officials also confirmed that Israel agreed to the move.
This decision was made after Pakistan acted as a mediator and requested a ceasefire period, including an extension of time for Iran to address oil sanctions in the Gulf region.
According to Iranian officials, further talks will be held in Islamabad to finalize the details of the agreement. The meeting is expected to start on Friday with a negotiation period of up to 15 days, and may be extended if both sides make progress.
Meanwhile, oil prices continued to rise amid heightened tensions in the Middle East, raising concerns about global supply disruptions.
Rising energy costs are putting pressure on inflation and limiting central banks' room to ease monetary policy.
As a safe haven, gold remains a favorite as geopolitical uncertainty increases. However, in a high interest rate environment, its appeal is somewhat limited as it does not offer interest returns.
Market focus now shifts to the Federal Reserve's (Fed) March meeting minutes, which are scheduled to be released early Thursday morning, for further clues on the direction of US monetary policy.
