As chances for a US rate decrease wane, gold is expected to have its worst month in over 17 years.

Tuesday saw an increase in gold prices due to expectations of a de-escalation in the Middle East war, but as rising energy prices dampened expectations of a U.S. interest rate decrease this year, gold prices were set for their worst month in over 17 years.

As of 02:35 GMT, spot gold was up 1.5% at $4,578.89 per ounce. April delivery U.S. gold futures increased 1.2% to $4,611.30.

Commodities denominated in US dollars became more accessible to holders of other currencies as the dollar weakened.Following U.S. President Donald Trump’s announcement to aides that he is willing to halt the U.S. military campaign against Iran, gold prices are rising in early Asia-Pacific trade. Financial markets responded riskily as a result, according to Ilya Spivak, head of global macro at Tastylive.

According to the Wall Street Journal on Monday, Trump told aides that he is prepared to halt the military campaign against Iran even if the Strait of Hormuz stays mostly closed and leave a difficult operation to reopen it at a later time.For the past week or so, gold has been stabilizing; last Friday’s surge was especially noteworthy. That coincided with a decline in Treasury yields, which appears to indicate that the markets are beginning to view the Iran war as a risk of a recession, according to Spivak.

A stronger dollar and dwindling chances of a U.S. interest rate cut this year have caused bullion to drop more than 13% so far this month, setting it up for its worst decline since October 2008. For the quarter, prices have increased by almost 5%.

The possibility of a rate cut by the U.S. Federal Reserve this year has nearly entirely been priced out by traders, as rising energy costs pose a danger to overall inflation. FEDWATCH Since gold is a non-yielding asset, it typically does well in an environment with low interest rates.

According to CME Group’s FedWatch program, two Fed rate cuts were anticipated for this year prior to the start of the Middle East conflict.

The U.S. central bank can wait to see how the Iran war impacts the economy and inflation, according to Fed Chair Jerome Powell, who stated on Monday that policymakers usually look past shocks like those brought on by rising oil prices.