Spot gold added 0.4% to $4,685.79 per ounce, having hit its ​highest level since March 20 at $4,723.21 earlier in the day

Gold prices edged higher on Wednesday to their highest in nearly two weeks, supported by a weaker dollar as U.S. President Donald Trump said the war with Iran could wind down within two to ​three weeks.

Spot gold added 0.4% to $4,685.79 per ounce by 0228 GMT, having hit its ​highest level since March 20 at $4,723.21 earlier in the day.

The U.S. dollar dropped 0.2%, making dollar-denominated commodities more ​affordable for holders of other currencies.

Talks that the U.S. might wrap up the war in ​two to three weeks even if the Strait of Hormuz is not reopened reinvigorated the U.S. equity markets and pulled gold higher along with it, said Marex analyst Edward Meir.

The U.S. president said Tehran did not have ​to make a deal as a prerequisite for the conflict to wind down.

Global ‌equity and ⁠bond markets rose on speculation of a potential de-escalation in the Middle East war.

However, the upside to gold prices is being limited due to the fact that interest rates can move higher if inflationary expectations reignite, Meir said.

Gold dropped more than 11% in March in its steepest ​monthly decline since October ​2008 as the dollar emerged as a safe-haven winner since the Iran war started on February 28.

Gold tends to thrive in a low-interest-rate environment as it is a non-yielding asset.

Should geopolitical tensions de-escalate further, then expectations for Fed easing ⁠could return. ​In such a scenario, real yields can ease, providing ​support for gold, said Christopher Wong, a strategist at OCBC.