Gold rebounds as yields retreat, risks remain

21 July 2026

Market comment on behalf of Joseph Dahrieh, Managing Director at Tickmill

Gold prices rose on Tuesday, supported by a broad pullback in global yields and a softer US dollar as markets weighed the prospect of renewed US-Iran talks. Optimism around a possible truce could ease concerns over energy-driven inflation, reducing the perceived need for the Federal Reserve to tighten monetary policy aggressively.

While reports that mediators are attempting to revive US-Iranian talks could help relieve pressure on gold, tensions stayed elevated amid ongoing military operations, leaving the precious metal exposed to renewed downside risk.

At the same time, markets are still positioned for one interest rate rise this year, with an additional hike expected in early 2027. A renewed surge in oil prices, should tensions broaden, could deepen inflation concerns, reinforce the case for tighter monetary policy and drive yields higher, adding to the pressure on gold.

Elsewhere, the European Central Bank is set to deliver its policy decision this week, with rates broadly expected to stay on hold, while the Bank of England follows with its own decision next week. Signals from either central bank could steer gold’s near-term direction.

 

Zaid Barem / ymm