Silver and Gold Leap as Hormuz Deal Sinks Oil, Dollar and Rate Expectations

SILVER and GOLD PRICES shot to multi-week highs Friday as the US Dollar fell together with crude oil and interest rates in the bond market on Iran declaring the Strait of Hormuz open to all shipping after Israel and Hezbollah agreed a ceasefire in Lebanon.

The news saw crude oil futures sink by more than 1/10th for both US benchmark WTI and European reference rate Brent.

The Dollar lost the last of its Iran War gains on its DXY index, trading back where it was on 27 February − eve of the US-Israeli airstrikes which began this conflict − while US Treasury bond yields fell to test their lowest level in a month.

Silver jumped above $82 per Troy ounce, its highest since 17 March.

Gold topped its highest in 4 weeks at $4887, also rising for the 3rd week-end in a row.

Global stock markets also leapt, making the steepest weekly jump on the MSCI World Index since last May's recovery from US President Trump's Liberation Day trade tariffs chaos and adding almost 5% since last Friday to the Vanguard Total World stock ETF (NYSEArca: VT).

"This takes the risk of an emergency [rate] hike off the table," Reuters quotes Evelyne Gomez Liechti, strategist in London at Japanese financial group Mizuho.

"I think we could see the market shift more towards [expecting a] holding reaction from the ECB and Bank of England."

Gold priced outside the Dollar showed less of a jump on Friday's ceasefire-and-Hormuz news, with UK gold prices in Pounds per ounce hitting a 7-session high just below £3600 while Euro gold prices failed to beat Tuesday's high of €4130.

"Big energy shock will push up prices," the BBC quoted Bank of England governor Andrew Bailey this morning, hinting at possible hikes to interest rates to combat inflation.

But "Bank 'in no rush to rates rise' says governor," said another headline, while "Bank of England could cut interest rates 'if war ends'," added another, also quoting Bailey's various media comments this week.

Erasing its Iran War gains, the Dollar today showed a drop of almost 3.0% from the 10-month high hit at the end of March on its DXY index.

US Treasury bond yields fell to 4.23% per annum on 10-year debt, and betting on Federal Reserve interest rates rushed the market consensus for end-2026 rates down beneath 3.50% for the first time since the first week of March.

German and UK government borrowing costs fell to 1-week lows beneath 3.0% and 4.70% respectively.

The MSCI World Index of rich-economy equities has now made 3 weekly gains of 3%-plus.

"In line with the ceasefire in Lebanon, the passage for all commercial vessels through Strait of Hormuz is declared completely open for the remaining period of ceasefire," said Iran's foreign ministry this morning.

But US President Trump then said that the naval blockade of Iran will remain in place until an outright peace deal is concluded.