US President Donald Trump has announced ceasefire. President Trump said that he is ready to impose a ceasefire with Iran for two weeks at the request of Pakistan. Iran and Israel have also agreed on this. The global commodity market reacted after this news. After Trump’s statement, there was a sharp rise in gold prices. The price of gold rose by about 1.6% to about $4,780 an ounce. This gain has increased further after the 1.2% rise in the previous session. Trump said on social media that an agreement had been reached to stop the bombing, which came just hours before his deadline was due to end.
Due to the ongoing tension in the Middle East for the last six weeks, oil and gas prices had increased rapidly and the risk of inflation had also increased. In such a situation, it is expected that the central bank may delay in reducing interest rates or even increase them if needed. Bond market experts believe that the Federal Reserve can keep interest rates stable for now. This is considered slightly negative for gold, because no interest is earned on gold.
There was a decline in the price of gold
Gold prices had also fallen by about 10% since the tension began in late February. Some investors sold gold to compensate for losses elsewhere, which also affected its image as a safe investment. By 6:46 am Singapore time, spot gold rose 1.4% to $4,770.50 an ounce. The price of silver increased by 2.6% to $74.90. Apart from this, a rise was also seen in platinum and palladium. At the same time, the dollar index has fallen by 0.3%.
Crude oil fell badly
After the announcement of ceasefire, a severe decline was seen in the prices of crude oil. The prices of both Brent oil and American crude decreased. Brent crude weakened by about $ 21 per barrel. At the same time, American crude oil also became weak around $19. There has been a huge fall in the prices of American crude oil in the international market. The prices which had earlier reached above $116 per barrel, have now fallen to around $91 per barrel. WTI crude prices fell almost 19% during trading to $ 91.11 per barrel, while it had closed at $ 112.41 a day earlier.
Also read- American stock market earns more than Indian stock market, this is the whole story