Gold Steady Near $4,150 Amid Fed Anticipation and Hormuz Talk

Spot gold prices stabilized near $4,150 per ounce in early trading on Friday, heading to close the week virtually unchanged as investors weighed Middle East developments against the path of US monetary policy, before the metal rebounded during the session to surpass $4,180.

US President Donald Trump said Washington is engaging in "productive negotiations" with Iran and will not launch an attack on Tehran before the midterm elections scheduled for November 3, remarks that sent oil prices lower. These statements came as Iran intensified its attacks on tankers passing through the Strait of Hormuz during the week, keeping geopolitical risks embedded in safe-haven asset pricing.

A hurricane disrupted oil production in the Gulf of Mexico, while markets are pricing in an approximately 82 percent probability that the Fed will keep interest rates unchanged this month, and around 81 percent for a rate hike in December. St. Louis Fed President Alberto Musalem noted that interest rates might need to rise over the next six to nine months to bring inflation back down to the 2 percent target.

The Strait of Hormuz remains a focal point for Arab investors, as nearly 20 percent of global oil supplies pass through it, directly linking any escalation there to global energy prices and, in turn, determining the level of demand for gold as a safe-haven asset against regional volatility.

What do these terms mean?

Ounce: A global unit of measurement for precious metals weight, equal to approximately 31.1 grams, used to price gold in the markets.

Geopolitical premium: An increase in an asset's price that reflects the surrounding political and security risks, which shrinks when the likelihood of escalation decreases.

Safe haven: An asset investors turn to during heightened risk or market turmoil, as its value tends to remain stable or rise during crises.