Baghdad: Gold prices rose as Brent crude fell below $100 a barrel and investors assessed developments in the Middle East for new indicators of inflation risks linked to US interest rate expectations. Spot gold rose 0.6% to $4,073.23 an ounce after falling 2% at Friday’s settlement, while US gold futures for August delivery advanced 0.6% to $4,075.90.

According to National Iraqi News Agency, Brent crude fell by about 4% after surging more than 7% and surpassing the $100 a barrel mark for the first time since May. This fluctuation occurred after US President Donald Trump threatened Iran and the Houthis with “major military punishment” following a Houthi attack on two oil tankers in the Red Sea.

The price of gold has seen a decrease of approximately 23% since the outbreak of the war between the United States and Iran in late February. The decline is attributed to expectations that war-induced inflation could maintain higher interest rates for an extended period. Although gold is traditionally viewed as a hedge against inflation, rising interest rates typically have a negative impact on this non-yielding asset.

Investors are now focused on the upcoming US Federal Reserve’s monetary policy meeting next week. During this meeting, the central bank is widely expected to keep interest rates unchanged, a decision that could further influence gold prices.

In the market for other precious metals, spot silver increased by 1.9% to $58.77 an ounce. Meanwhile, platinum experienced a decline of 0.5% to $1,592.89 an ounce, and palladium saw a modest gain of 0.2% to $1,259.42.