Gold Prices Surge As Oil Prices Tumble On Easing War Fears

(RTTNews) - Gold prices climbed on Wednesday, driven by a softer dollar and easing bond yields on expectations of a de-escalation in the U.S.-Iran conflict.

Spot gold jumped a little over 2 percent to $4,565.18 an ounce while U.S. gold futures were up 3.6 percent at $4,595.67.

The dollar index dipped on improved risk sentiment while oil prices plunged more than 5 percent after U.S. President Donald Trump said the U.S. and Iran were "in negotiations right now" and they "want to make a deal so badly".

While Tehran dismissed the U.S. president's claim of talks, a slew of media reports suggested that efforts towards a diplomatic solution have intensified.

According to a New York Times report, the United States has sent Iran a 15-point plan to end the war in the Middle East.

Israel's Channel 12 revealed that Washington was pursuing a one-month ceasefire under a mechanism being developed by Steve Witkoff and Jared Kushner.

Axios said that the U.S. and a group of regional mediators are discussing the possibility of holding high-level peace talks with Iran as soon as Thursday, but they're still waiting for a response from Tehran.

Iran has told the United Nations Security Council and the International Maritime Organization that "non-hostile vessels" may transit the Strait of Hormuz, with Tehran's consent.

Meanwhile, Federal Reserve (Fed) Governor Michael Barr said on Tuesday that interest rates could stay unchanged for a while before any further cuts, noting rate cuts would require evidence that inflation is falling in a sustainable way.

Elsewhere, Bank of Japan (BoJ) board members have shared their views on the monetary policy outlook.

As per the BoJ Minutes of the January meeting, many board members saw the need to keep raising interest rates to address mounting inflationary pressures and the weak yen's impact on prices.