Oil price decline and Federal Reserve rate hikes "cool" inflation panic, gold regains its footing above the 100-day moving average.

At the end of a volatile week, international gold prices held onto their gains as the Federal Reserve's first rate hike since 2023 and falling oil prices helped ease market concerns about inflation. Data showed that on Friday, spot gold traded near $4,350 an ounce, after rising nearly 2% on Thursday and erasing most of the losses from the previous three days. After the Fed unanimously decided on Wednesday to raise rates by 25 basis points, U.S. Treasury yields initially surged, then fell across maturities. This shift reduced some of the pressure on gold. Since gold pays no interest, it typically performs poorly when bond yields are high. Oil prices fell for a third consecutive day as Middle East supply disruptions appeared poised to ease, thereby reducing the pressure from energy costs on inflation. Saudi Arabia has begun restoring throughput on a key pipeline within days, while some tankers continued to transit the still-tense Strait of Hormuz. Thursday's rebound lifted gold back above its 100-day moving average, a measure of momentum. Even so, gold prices remain nearly one-fifth below their level before the outbreak of the Iran war at the end of February. In recent weeks, investors have rushed into gold, betting that the metal's long-term drivers will persist. Even as prices fell, gold ETFs still recorded inflows. However, Federal Reserve Chair Kevin Warsh's remarks on inflation raised market expectations that there will be at least one more rate hike this year, and as many as two more in 2027, constituting a potential headwind for gold. As of press time, spot gold was up 0.05% at $4,348 an ounce. Silver rose 0.5% to $65.74 an ounce, after surging 3.6% the previous day. Platinum and palladium edged higher. The dollar spot index, which measures the greenback's performance, was little changed after falling 0.1% in the previous session.