Gold prices ticked up in thin European trading as ‌the dollar eased and as markets assessed the impact on oil prices and inflation expectations of a ​ceasefire proposal in the U.S.-Israel war with Iran.

Spot gold was up 0.35% at $4,691.86 per ounce by ​1040 GMT after ​falling 1%, with many markets across Europe closed on Easter Monday. U.S. gold futures for June delivery rose 0.83% to $4,718.20 per ounce.

"We saw the gain around headlines about ⁠a potential ceasefire," said Kyle Rodda, senior financial market analyst at Capital.com. "The substance behind that is quite questionable, but the move seems to unwind a little bit of the bid in oil, the dollar's going down with oil...so gold (has) bounced."

Crude prices were down more than ​1%, but ‌holding above $107 a barrel. ⁠The dollar index ⁠inched 0.2% lower, making gold cheaper for those holding other currencies.

Rising oil prices can feed into headline ​inflation as businesses pass on higher costs, and prevent central ‌banks from cutting interest rates. While gold is traditionally seen ⁠as an inflation hedge, elevated interest rates can sap the non-yielding asset's appeal.

Traders have almost completely priced out any chances of the U.S. Federal Reserve cutting rates this year, according to CME's FedWatch tool, compared with expectations for two 25 basis point reductions before the Iran war began. Iran said that it had formulated its positions and demands in response to ceasefire proposals conveyed via intermediaries, and that negotiations were "incompatible with ultimatums and threats to commit war crimes".

The U.S. and Iran had received the framework of a plan ‌for a ceasefire, with Iran immediately rejecting the reopening of the Strait ⁠of Hormuz, after President Donald Trump threatened to rain "hell" on ​Tehran if it did not make a deal by the end of Tuesday.

"The next forty-eight hours are crucial because if the strikes on Iranian power plants happen, it's going to be ​chaos (and hence) ‌guaranteed volatility," Rodda added.

Spot silver rose 0.3% to $73.21 per ounce, ⁠spot platinum added 0.35% to $1,995.98, while palladium was ​up 0.51% at $1,510.63.

(Reporting by Ishaan Arora in Bengaluru; Editing by Kirsten Donovan)