Gold and Silver Surge as Oil Prices Soften

 

Gold and Silver Surge as Oil Prices Soften

(August 5, 2026) – Gold and silver prices surged on Wednesday, gaining amid reported progress in talks between the United States and Iran over the Strait of Hormuz. The spot price of gold gained more than $172 per troy ounce, crossing $4,250/ozt. Silver prices added over $2.20 per troy ounce, crossing a tricky $60/ozt line that has proven difficult for silver bulls to overcome in recent weeks. The price action favored gold, driving the gold-silver ratio a bit higher to close the trading day.

Leaders in Iran and Oman said on Tuesday that officials are approaching a deal that would reopen the Strait of Hormuz, a vital waterway with a status contested by the U.S. and Tehran. U.S. President Donald Trump told reporters that “a lot of progress has been made” in talks with Iran, saying a deal could be announced as early as Wednesday or Thursday. The proposed deal between Iran and Oman is expected to give Tehran more control over inbound shipping traffic, according to the New York Times.

The price of crude oil fell throughout the week as markets priced in a bit of hope that the Strait of Hormuz may be reopened. Crude oil futures are down by more than 10% in the past five days following a spike in the wake of heightened tensions between the U.S. and Iran in late July. Gold and silver prices responded, adding several percentage points and driving the spot price of gold back to its mid-June levels.

Wall Street moved in the opposite direction, with the Nasdaq closing 0.8% lower and the Dow and S&P 500 logging only modest gains on the trading day.

On Friday, traders will be able to review the U.S. employment report for the month of July. June’s numbers clocked in at 57,000 jobs created, and the median forecast for July anticipates an increase to 83,000 new jobs. This report could have major implications for the Federal Reserve’s next meeting in September. In July, the FOMC voted to leave interest rates unchanged. Three Fed officials dissented, preferring instead to raise the federal interest rate by 0.25%.

The Federal Reserve is widely expected to raise interest rates at least once this year, but the near-term outlook is more complicated. CME FedWatch projects a probability of 54.4% that the FOMC votes to raise rates at its next meeting in September but an 80.1% likelihood that rates end the year higher. Traders will be watching Friday’s employment report closely. An especially strong labor report could boost the odds of a rate cut in September, while a weak employment reading may cause the Fed to hold off for another month in order to avoid introducing more downside risk to the job market.

Markets are likely to focus on both the rate hike outlook and geopolitics in the Middle East for the rest of the week. A major announcement out of the Strait of Hormuz could have an immediate impact on safe haven demand, while a large change in the job market outlook could introduce a bit more long-term speculation. Safe haven assets like gold tend to thrive in periods of falling interest rates, and interest rate hikes can have a chilling effect on the precious metals market.