PRECIOUS-Gold firms on easing oil prices after US-Iran ceasefire deal

Updates for European morning hours

Fed held rates steady on Wednesday

Spot gold fell 1.7% in the previous session

Hawkish Fed leaves gold with greater bias of dipping - analyst

By Ashitha Shivaprasad

June 18 (Reuters) - Gold firmed on Thursday as lower oil prices following the U.S.-Iran ceasefire deal helped bullion recover from losses in the previous session triggered by hawkish Federal Reserve rhetoric.

Spot gold XAU= was up 0.6% at $4,284.67 per ounce, as of 0830 GMT, after falling 1.7% on Wednesday. U.S. gold futures GCcv1 fell 1.8% to $4,304.30.

Oil prices fell after the U.S. and Iran signed an interim agreement that would end the Iran war, reopen the Strait of Hormuz, and waive U.S. sanctions on Tehran's oil, boosting the oil supply outlook. O/R

"Gold is rebounding today after markets swiftly moved past the Fed's hawkish signals, with bulls opting to squeeze more gains out of the US-Iran interim peace deal," said Han Tan, chief market analyst at Bybit.

However, "the hawkish Fed leaves spot gold with a greater bias of dipping back into sub-$4,000 waters rather than reclaiming the $5,000 handle in the second half of 2026," Tan added.

The Fed held interest rates steady on Wednesday, but policymakers expect a hike in borrowing costs later this year amid growing concerns about inflation lodged above the U.S. central bank's 2% target. Fed Chair Kevin Warsh said at the press conference that he was launching a series of task forces to examine central bank operations more broadly.

According to the CME FedWatch Tool, markets are now pricing in about an 85% probability of a U.S. rate hike in December. FEDWATCH

Gold typically becomes less attractive in a high-interest-rate environment because it offers no yield.

ANZ said in a note that "investment demand (for gold) is weak, with exchange-traded funds outflows and lighter positioning, but physical demand, especially from China, and central bank buying are underpinning the market."

It added that structural drivers, such as geopolitics and de-dollarisation, remain supportive.

Among other metals, spot silver XAG= rose 0.4% to $68.24 per ounce, platinum XPT= fell 0.1% to $1,735.34, and palladium XPD= was flat at $1,312.54.


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