World gold and silver prices opened the new trading week in green after suffering a sharp drop last week. Spot gold rose about 0.6% to around 4,570 USD/ounce, extending the recovery momentum from an eight-day low, while silver jumped 2.39% to 78.12 USD/ounce.
Investors said bottom-fishing buying was the main factor helping the precious metal recover, but pressure from rising oil prices and high US bond yields remained, causing the market to continue to fluctuate unpredictably.
Analysts emphasize that expectations for diplomatic progress between the US and Iran are a psychological support factor for gold. The weakening USD also helps increase the attractiveness of the precious metal valued in dollars to international buyers.
However, warnings from US President Donald Trump about Iran's action deadlines show that geopolitical risks are still high, both creating safe haven demand and potentially pushing energy costs up sharply, affecting inflation and monetary policy.
In the interest rate market, according to CME Group's FedWatch tool, investors are currently forecasting more than 50% of the Fed's ability to raise interest rates before the end of the year. High interest rates increase the opportunity cost of holding gold, creating a fundamental resistance for precious metals, although geopolitics still support prices.
Mr. Marc Chandler - Managing Director of Bannockburn Global Forex, commented: "Gold has recovered after last week's low, but pressure from interest rates and inflation makes the upward momentum difficult to sustain without positive signals from the diplomatic process.
Silver, after a decrease of nearly 15% in just two days last weekend, also recovered thanks to technical buying power, but the dual role of being both an industrial commodity and a tool to store value makes this metal sensitive to growth expectations.
According to Mr. John Reade - Investment Director of the World Gold Council: "Silver is reflecting both global economic expectations and shelter demand. Fluctuations will remain high in the short term until the situation in the Strait of Hormuz stabilizes.
Experts warn that for gold and silver to have a sustainable upward momentum, two important conditions need to be met: US-Iran tensions cool down and the Hormuz Strait energy transport route resumes trade.
This is a strategic bottleneck in oil and gas supplies, directly affecting energy prices, supply chains and global consumer costs.
Until geopolitics is clear, precious metals will still be dominated by news, supported by uncertainty but limited by the impact of inflation and monetary policy.
Domestic investors should closely monitor geopolitical developments and international monetary policy, and consider market sentiment when deciding to buy and sell gold bars and silver rings this week, avoiding emotional trading in the context of prolonged fluctuations.
