Gold Rallies on Escalating US–Iran Tensions Ahead of Critical US Inflation and GDP Data

Today's expected range for the Canadian Dollar against the major currencies:

US Dollar        1.3570-1.3820

Euro                1.5990-1.6240

Sterling           1.8330-1.8580

WTI Oil (opening level) $66.03

The CAD/USD is opening at 1.3691 ( 0.7304 )

Gold gained momentum after trading largely flat for a couple of days, as ongoing tensions between the USA and Iran lift demand for safe-haven assets.

USA-Iran tensions escalated after Trump warned that he expects clarity on a new nuclear deal within the next 10 to 15 days. “We’re either going to get a deal, or it’s going to be unfortunate for them,” Trump said, as the US military buildup in the Middle East continues.

Meanwhile, Iran and Russia also conducted joint naval drills in the Gulf of Oman on Thursday. Iran’s envoy to the United Nations said Tehran would respond “decisively” to any “military aggression” by the United States and called on the UN Security Council to condemn recent threats by President Trump.

Gold has now retraced almost all of losses seen earlier in the week, suggesting buyers have stepped back in, reinforcing the broader bullish structure, even as a firm USD and fading Federal Reserve interest rate cut bets act as headwinds.

Resilient US economic data and hawkish-leaning Federal Reserve Meeting Minutes released earlier this week have prompted traders to scale back expectations for near-term interest-rate cuts.

Upcoming data, including the core Personal Consumption Expenditures Price Index and the advance estimate of fourth-quarter US GDP, due today are likely to provide further clues on the monetary policy path and could drive short-term volatility in Gold.

Headlines

• Japan's annual inflation fell to 1.5% in January 2026, the lowest since March 2022. Food and transport prices slowed, while energy costs remained negative. Core inflation reached the central bank's 2% target. Monthly CPI declined 0.2%.
• Trump stated the US needs to "make a meaningful deal" with Iran, adding that the next 10 to 15 days will determine an accord. He noted Iran is a "hot spot" but mentioned "good talks" with officials. The vast array of US forces in the Middle East could sustain a campaign lasting many days.
• The Philadelphia Fed Manufacturing Index increased to 16.3 in February 2026, exceeding expectations. Business activity and orders were strong, but shipments slowed. Employment dipped slightly, and the workweek shortened. Prices rose overall, though at a slower pace.
• US pending home sales fell 0.8% in January 2026, after a 7.4% drop in December, missing the expected 1.3% increase. Sales decreased in the Northeast and South but rose in the Midwest and West. Year-over-year, sales were down 0.4%. Economist Lawrence Yun emphasized the need for more housing supply to avert higher prices.
• US initial jobless claims fell 23,000 to 206,000 in mid-February, below the expected 225,000. Continuing claims grew 17,000 to 1,869,000, indicating a stable labor market.
• The US trade deficit grew to $70.3 billion in December 2025, above the $55.5 billion forecast. Exports fell by 1.7%, and imports rose by 3.6%. The 2025 trade deficit was $901.5 billion, slightly less than 2024, with reduced deficits with the EU and China but expanded with Mexico, Vietnam, and Taiwan.

Key Points

• Equities: U.S. and Europe slipped on higher-rate worries and Iran headlines, Asia rose in Japan and Singapore, with Hong Kong closed.
• Volatility: VIX above 20, macro data in focus, skew firm
• Digital Assets: BTC/ETH stabilising, IBIT and ETHA outflows, macro-driven tone
• Fixed Income: US treasuries find support Thursday despite firm US data.
• Currencies: EURUSD and GBPUSD break lower, AUD remains broadly firm
• Commodities: BCOM posts weekly gain as geopolitics lift energy and precious metals