Gold rises 3% to 2-week high

Gold and silver bars

Gold and silver prices advanced on Wednesday, supported by signs that the US and Iran are nearing a peace agreement, easing concerns over rising inflation and the prospect of interest rates remaining restrictive for an extended period.

June gold futures surged 2.75%, or $125.80, to settle at $4,694.30 per ounce, marking their highest close since April 24.

May silver futures also climbed 5%, or $3.703, to $76.811 per ounce, extending gains for a second straight session.

Precious metals received strong support from declines in both the dollar and oil prices after Iran confirmed receiving a new settlement proposal from the US. Meanwhile, US President Donald Trump expressed optimism about reaching an agreement ahead of his expected visit to China next week.

Despite the gains, caution continues to dominate markets as investors await the release of the US monthly employment report on Friday. Earlier data from ADP Research Institute showed that the private sector added more jobs than expected in April.

While the data reinforced investor confidence in the resilience of the labor market, St. Louis Federal President warned that risks are now tilting more clearly toward higher inflation rather than weaker employment.