Gold rises over 1% on softer dollar, easing inflation

May 25, 2026 (MLN): Gold prices climbed more than 1% on Monday as easing inflation expectations and a weaker US dollar supported demand for the safe-haven metal.

Currently, spot gold is slightly up 1.03% to $4,554.75 an ounce as of [11:34 am] PST, according to data reported by Mettis Global.

Sentiment improved after reports of progress in US-Iran discussions, including remarks that Washington and Tehran had “largely negotiated” a memorandum of understanding aimed at a potential peace framework that could reopen the Strait of Hormuz.

However, US President Donald Trump tempered expectations, stating he was in no rush to conclude any agreement, according to Reuters.

The dollar hovered near a one-week low, making gold more attractive for buyers using other currencies. At the same time, crude oil prices fell sharply, easing concerns over inflationary pressure, since lower energy costs reduce expectations of prolonged high interest rates.

Adding to the energy market volatility, crude oil benchmarks extended losses after reports that Brent fell more than 5% to around $97.85 per barrel while WTI slipped over 5% to near $90.94, as diplomatic signals boosted expectations of reduced supply disruption risks.

While gold is traditionally viewed as a hedge against inflation, higher interest rates tend to reduce its appeal as a non-yielding asset. The decline in oil prices helped soften rate outlook concerns, further supporting bullion.

Meanwhile, markets also reacted to the swearing-in of Kevin Warsh as chair of the US Federal Reserve on Friday, at a time when geopolitical tensions and earlier energy-driven inflation had weighed on consumer sentiment.

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