Gold closes slightly higher with expectations for the signing of a US-Iran agreement

The gold futures contract closed slightly higher this Tuesday (16), extending the gains of the last two sessions, while investors maintain expectations for the signing of the memorandum of understanding between the United States and Iran to end the war in the Middle East, despite the lack of further details about the pact.

On the radar, the market awaits the Fed's (Federal Reserve) interest rate decision on Wednesday (17).

On Comex, the metals division of the New York Stock Exchange (Nymex), gold for August closed up 0.06%, at US$4,354.40 per troy ounce, while silver for July fell 0.24%, to US$70.013 per troy ounce.

This Tuesday, US President Donald Trump signaled progress in dialogue with Iran and highlighted that there will be a new phase of negotiations to deal with Iran's nuclear program. On the Tehran side, authorities reported that ships began to travel through the Strait of Hormuz.

For Mauriciano Cavalcante, consultant at Ourominas, the scenario puts gold values on a slight rise given the combination of geopolitical reading, oil and expectations about global interest rates. He explains that the possible agreement between the US and Iran helped reduce pressure on oil, which changes the market's reading.

"If energy stops putting so much pressure on global inflation, the perception that central banks will need to maintain high interest rates for an even longer period also decreases. For gold, this scenario tends to be positive, because it reduces part of the cost of carrying the metal and reinforces its role as protection in portfolios", he details.

Post-war oil in the Middle East tends to be more expensive, says analyst | MARKET OPENING

In analysis, Barclays assesses that the precious metal has room for an even greater recovery, depending on the continuity of geopolitical relief, particularly in a scenario in which falling energy prices alleviate inflation and pressure on interest rates.

Still on precious commodities, Julius Baer highlights that demand for investments in gold and silver should recover, even if it is not as strong as that recorded before the start of the war in the Middle East.

*With information from Dow Jones Newswires.

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Source: CNN