Spot Gold maintained ground near a 1-month high on Thursday on the back of a softer US Dollar and lower Treasury yields amid optimism about a potential end to the Middle East conflict.
US President Donald Trump said that he believed the war with Iran may be coming to a conclusion soon, while the White House expressed optimism about reaching a deal to end the conflict.
Moreover, reports suggested that there were growing prospects for a second round of peace talks between the US and Iran that could take place in a matter of days.
Optimism over diplomatic efforts to prolong the US-Iran ceasefire has been a central factor behind the recent softening of the US Dollar, which fell to a more than 1-month low.
A softer US Dollar makes dollar-priced Gold more appealing to international investors holding other currencies.
Yet, shipping through the Strait of Hormuz still remains heavily restricted, with the US blockading Iranian ships and Tehran limiting broader traffic.
On the data front, US producer price figures released this week eased concerns over the inflationary impact of the war-driven surge in energy prices and tempered hawkish Fed expectations.
Markets are now pricing in a 29% chance of a 25 basis point Fed rate cut by year-end, compared to about 13% last week.
Spot Gold was last up 0.19% on the day to trade at $4,800.27 per troy ounce.
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