Gold prices firmed on Wednesday as lower oil prices, following a US extension of a ceasefire with Iran, eased ‌fears of an inflation spike and prolonged high interest rates.

Spot gold rose 0.9% to $4,755.11 per ounce, after falling to its lowest level since April 13 on Tuesday.

US gold futures for ​June delivery gained 1.1% to $4,772.90.

US President Donald Trump said he would indefinitely ​extend the ceasefire with Iran to allow for further peace talks, hours ⁠before it was set to expire.

Trump’s announcement appeared to be unilateral, and it ​was not immediately clear whether Iran or the US ally Israel would agree to ​extend the ceasefire, which began two weeks ago.

“With this ceasefire extension, the markets perceive a de-escalation in the crisis,” said Marex analyst Edward Meir.

“If the ceasefire ends and hostilities resume, we will see the ​dollar strengthen, oil and interest rates go up, and that should pressure (gold) prices.”

Stocks ​gained, the dollar eased, and oil prices turned lower following the ceasefire extension.

Higher crude prices can stoke ‌inflation ⁠by raising transportation and production costs.

While gold is considered an inflation hedge, high interest rates make yield-bearing assets more attractive, weighing on the bullion’s appeal.

“Price action remains at the mercy of Middle East ceasefire headlines and liquidity needs,” Standard Chartered said in a ​note.

“While we note ​that the recent ⁠tick higher in prices has been fragile and is at risk of a short-term correction, we continue to expect (precious metals) prices ​to recover and gold in particular to retest record highs.”

Meanwhile, ​Federal Reserve ⁠chief nominee Kevin Warsh said on Tuesday he had made no promises to Trump about cutting interest rates, as he tried to assure US senators mulling his confirmation to lead ⁠the ​central bank that he would act independently of ​the White House while pursuing broad reforms.

Spot silver rose 1.5% to $77.84 per ounce, platinum gained 1.5% to $2,067.25, and ​palladium was up 1.8% at $1,560.31.