Gold turns positive as oil eases on hopes for Iran talks

Gold inched up on Friday, ​reversing earlier losses of more than 1%, on hopes for a breakthrough to ‌end the Iran war after Tehran submitted a new proposal for negotiations, easing some inflation concerns.

Spot gold was up 0.1% to $4,627.63 per ounce at 1:50 p.m. ET (1750 GMT) after falling to as low as $4,559.48 earlier ​in the session. It was still on track for a weekly loss of ​1.7%. U.S. gold futures for June delivery were up 0.4% to $4,649.60.

"Positive news regarding ⁠negotiations to end the war with Iran helped gold recover from early morning losses," ​said Chris Gaffney, president of world markets at EverBank.

"An end to the Iran war could ​lead the FOMC to begin cutting interest rates again which would decrease the value of the U.S. dollar, which would be a positive for gold prices," he added.

The dollar eased against its peers, making ​greenback-priced bullion cheaper for buyers holding other currencies.

Iran has submitted its latest proposal for negotiations ​with the United States, Iranian state media and a Pakistani official said.

Oil prices dropped on the news, ‌though they ⁠remained on track for weekly gains, continuing to fuel concerns about a global economic slowdown and surging inflation as fuel prices climb.

Rising costs could prompt central banks to keep interest rates higher for longer, weighing on non-yielding assets such as gold as investors turn ​to alternatives like Treasury ​yields.

The U.S. Federal ⁠Reserve kept interest rates unchanged this week and struck a hawkish tone that saw markets abandon expectations for a rate cut this year.

Bullion ​prices have fallen since the start of the Iran conflict in ​late February, ⁠despite the metal's traditional role as a hedge against geopolitical uncertainty.

Among other precious metals, spot silver prices rose 3% to $75.91 per ounce.

"Long-term outlook (for silver) remains supported by a sixth consecutive annual ⁠market ​deficit, shrinking above-ground inventories and firm demand from solar ​and private investors," wrote Ole Hansen, head of commodity strategy at Saxo Bank.

Platinum was up 0.3% at $1,992.05, and palladium ​added 0.6% to $1,532.79.