Oil and gold prices moved higher on Wednesday as investors reacted to rising Middle East tensions and awaited key US inflation data.
Brent crude climbed above $89 per barrel, while US crude approached $84. Oil has now risen for six consecutive sessions. Traders remain focused on signals surrounding possible negotiations between Washington and Tehran.
Pakistan’s defense minister said the United States and Iran were close to “some form of agreement” over the Strait of Hormuz. Reports also suggested that talks between Iran and Oman had reached an advanced stage.
However, uncertainty remains. US President Donald Trump has taken a tougher position and demanded that Tehran compensate families of people killed during attacks and unrest. Iran, meanwhile, has continued pressing for compensation over wartime damage.
US crude inventories also rose by 9.1 million barrels last week, the largest increase since February.
Gold prices moved toward $4,400 per ounce on Wednesday, recovering losses from the previous two sessions. Investors are waiting for US inflation data to assess the Federal Reserve’s next move.
Markets remain divided over whether the Fed will raise rates by 0.25% in September.
Gold continues to receive support from central-bank buying. China’s central bank reportedly added about 20 tonnes of gold to its reserves in July after buying 15 tonnes in June.
Analysts say geopolitical risks and uncertainty around Hormuz continue to support both oil and gold.
US consumer prices are expected to rise 0.1% in July after falling 0.4% in June. Softer inflation could reduce pressure for another rate increase.
Japan’s bond market is also under pressure. The yield on five-year government bonds reached 2.1%, while two-year yields climbed to 1.63%, their highest level in 31 years.
Markets remain sensitive to inflation data, interest rates and geopolitical developments. Investors are watching closely for signs of further market volatility.
