Gold Surges 1.2% as U.S.-Iran Peace Prospects Defy Safe-Haven Norm

Gold futures surged on Friday, May 29, 2026, breaking from the metal's traditional role as a hedge against geopolitical turmoil, as the U.S. and Iran signaled growing momentum toward ending their military conflict. The most-active August contract climbed 1.2% to settle at $2,348.60 an ounce on the Comex. The rally confounded traders who typically bid up bullion on elevated tensions, but analysts pointed to a weakening U.S. dollar and expectations that a diplomatic resolution could unleash inflationary pressures, boosting demand for the precious metal as a store of value. The dollar index slid 0.4% against a basket of currencies, making gold cheaper for overseas buyers. Some investors also bet that a gradual normalization of relations could reduce the need for aggressive Federal Reserve rate cuts, temporarily supporting gold through inflation expectations rather than rate sensitivity. The move underscored how shifting macro narratives can override typical safe-haven flows.