(Bloomberg) — Gold swung between gains and losses as traders weighed the path of a fragile ceasefire as the US and Iran start talks this weekend.

Bullion hovered near $4,757 an ounce as the New York Post reported US President Donald Trump is preparing the military if peace talks in Pakistan this weekend fail. Gold is heading for its third weekly gain, on pace for a 1.8% increase.

Trump warned Iran that it “better stop” any effort to charge fees on ships transiting the Strait of Hormuz, after agreeing to open the critical waterway as part of a ceasefire agreement earlier this week. Negotiations for a long-term peace deal are set to begin Saturday in Islamabad, where control of the passage remains Iran’s strongest point of leverage.

On the economic front, the latest US data on Friday showed while consumer prices jumped the most since 2022, core inflation — which is closely watched by the Federal Reserve — was relatively tame. Bond yields edged up while the dollar barely moved, but traders kept betting on a rate cut this year. Lower rates typically benefit bullion as it pays no interest.

Gold has also been supported by signs that some of the world’s biggest bullion buyers are continuing to build their stockpiles. Poland’s central bank is maintaining a goal to lift reserves to 700 tons, its governor said, while China took advantage of lower prices to add about 5 tons in March – its biggest monthly purchase in more than a year.

ANZ Bank expects recent price corrections to motivate more stockpiling, with official central-bank buying for this year to be around 850 tons.

Spot gold was down 0.1% at $4,760.69 an ounce at 1:02 p.m. in New York. Silver rose 1% to $76.11 an ounce. Platinum and palladium declined. The Bloomberg Dollar Spot Index was steady.

–With assistance from William Clowes and Yvonne Yue Li.

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