Gold Prices Could Surge This Week, Ready for Another Rally?
Jakarta, CNBC Indonesia – Gold prices are forecast to rise this week if a US-Iran peace deal is reached. At the start of trading on Monday, 25 May 2026 at 06:35 WIB, gold surged 1.53% to $4,577.64 per troy ounce, reversing Friday’s decline when it closed at $4,508.73 per troy ounce, down 0.8%. The weekly drop was 0.65%, marking two consecutive weeks of decline.
FX Street analyst Lallalit Srijandorn predicted the precious metal would attract buying interest as the US dollar weakened, with the dollar index dropping to 98.99 on Monday morning, its weakest in seven days.
Senior Middle East and North Africa analyst Rania Gule stated that any political or economic agreement between the two nations would directly impact oil, gold, and silver prices, not only through supply and demand but also via shifts in global risk appetite and reduced geopolitical risk premiums.
‘The market is likely to open on Monday with a significant price gap due to rapid investor reactions, before prices stabilise once the details of the agreement become clear,’ Gule, cited by The Khaleej Times, said.
She added that a peace deal would likely suppress oil prices as the market anticipates Iran’s return to global oil supplies, while the dollar’s weakness would support gold demand. However, she expects limited gold declines due to structural factors such as expectations of US rate cuts, central bank purchases, and global debt concerns.
‘Gold prices may fall by 2% to 5% in the short term,’ Gule noted.
Washington and Tehran are reportedly advancing in talks to end the conflict, though US President Donald Trump stressed he would not ‘rush’ a deal. US Secretary of State Marco Rubio mentioned positive signs for a peace agreement but cautioned that it would be difficult to implement if Iran sought permanent control over the Strait of Hormuz shipping lanes.
Uncertainty over the US-Iran deal has raised fears that prolonged shipping restrictions in the Strait of Hormuz could harm global economic growth. Gold market participants are also awaiting Thursday’s release of the US Personal Consumption Expenditures (PCE) price index data, which could influence Federal Reserve interest rate decisions and dollar-denominated commodity prices if US inflation heats up.