Gold Holds Firm as Ceasefire Eases Energy Fears

Ved Shah

Good evening ladies and gentlemen, and welcome back to The Australian Gold Mid-Weekly Review.

This week, two major developments are driving markets.

First, the United States and Iran have agreed to extend the ceasefire and reopen the Strait of Hormuz, easing concerns around global energy supply. Second, investors are waiting for Kevin Warsh's first Federal Reserve decision as Chair, with markets focused less on today's rate decision and more on what comes next.

Together, these events could shape the outlook for gold, silver and ASX precious metals stocks for the remainder of 2026.

Gold is currently trading around the US$4,340 to US$4,360 per ounce range and continues to recover from the sharp correction seen earlier this year. While prices remain below the January peak of approximately US$5,589 per ounce, gold has shown impressive resilience in recent weeks.

What stands out is that gold held firm after the Iran ceasefire announcement. Normally, a reduction in geopolitical risk can lead to profit-taking in precious metals. This time, however, the market absorbed the news relatively well.

That suggests investors are looking beyond short-term headlines and focusing on the broader macro picture, including central bank demand, fiscal deficits, sovereign debt concerns and the long-term outlook for interest rates.

In other words, gold is behaving less like a short-term crisis trade and more like a strategic asset allocation. Despite recent volatility, gold remains roughly 28% higher than this time last year, which shows that the broader trend remains firmly upward.

Silver has continued to outperform gold and remains one of the strongest-performing commodities in the market. The metal is currently trading around US$70 to US$71 per ounce and posted gains of around 4% following the ceasefire announcement.

That move once again highlights how much more volatile silver can be compared to gold. While silver experienced a significant correction after its parabolic move earlier in the year, prices remain more than 25% above levels seen last October.

Turning to our local markets, the ASX All Ordinaries Gold Index has continued its recovery and is currently trading around 17,171 points. The index has gained close to 3% in recent sessions and has recovered strongly from the lows reached during the March correction.

However, the biggest geopolitical development this week was the agreement between the United States and Iran to extend the ceasefire and reopen the Strait of Hormuz.

Markets had spent months pricing in the possibility of a prolonged disruption to global energy supplies. Instead, negotiations appear to have moved toward a more constructive outcome.

The agreement remains fragile, with nuclear negotiations and inspection arrangements still unresolved. However, for now, markets are treating it as a meaningful de-escalation.

The immediate market reaction was a decline in oil prices, easing inflation concerns and reducing pressure on central banks to maintain restrictive policy settings. For gold investors, that is an important development because lower energy costs can create a more supportive backdrop for precious metals over time.

What is notable is that gold has remained resilient even as oil prices have eased. That suggests the broader bull market remains intact and is no longer relying only on geopolitical fear.

The second major event this week is the Federal Reserve meeting. Markets overwhelmingly expect rates to remain unchanged, so the decision itself is unlikely to surprise investors.

Instead, attention is focused on Kevin Warsh's first press conference as Fed Chair and the updated economic projections. Investors will be watching the dot plot closely, along with any changes to the Fed's language around future rate cuts.

A more hawkish tone could create some short-term pressure on gold, while a neutral or dovish stance would likely be supportive. More importantly, if energy prices remain lower following the Iran ceasefire, inflation pressures could continue to ease, giving the Fed greater flexibility moving forward.

For now, the market is less interested in what the Fed does today and more interested in what it signals about the path ahead.

All said and done, the key takeaway this week is that two major uncertainties are beginning to clear.

The Iran ceasefire has reduced pressure on global energy markets, while today's Federal Reserve meeting should provide greater clarity around the interest-rate outlook.

Gold remains well above recent lows, silver continues to show relative strength, and ASX gold producers are recovering alongside the broader precious metals sector.

As always, we will continue focusing on quality companies, disciplined positioning and long-term value opportunities across the market.

Thank you for tuning in, and we look forward to seeing you again this Sunday for the next episode of The Australian Gold Weekly Review!