Gold prices were largely steady on Tuesday after touching a more than one-week high in the previous session as investors assessed the implications of a preliminary US-Iran peace deal while awaiting further clarity on the agreement’s terms and broader geopolitical direction.
Spot gold rose 0.2% to US$4,315.87 per ounce as of 0231 GMT after climbing as much as 3.6% on Monday to its highest level since 5 June. US gold futures for August delivery eased 0.3% to US$4,337.10, reflecting some profit-taking after the sharp rally.
The metal’s earlier gains were driven by heightened demand for safe-haven assets following news that the US and Iran had signed a preliminary agreement to end the conflict in the Gulf. However, uncertainty remains as both sides have indicated that a permanent truce has yet to be finalised and key details of the deal have not been disclosed.
Market participants said sentiment has been supported by expectations that the ceasefire could ease geopolitical tensions, although the lack of clarity has kept traders cautious. The US dollar also hovered near 10-day lows ahead of key central bank meetings, providing additional support for bullion.
Attention is now turning to the Federal Reserve’s upcoming policy decision and remarks, with interest rates widely expected to remain unchanged. Traders are watching for signals on the future rate path, which will influence gold’s appeal given its sensitivity to interest rate expectations.
Gold, a non-yielding asset, typically benefits in low-rate environments while higher interest rates tend to weigh on demand. Despite near-term consolidation, bullion remains supported by a combination of geopolitical uncertainty and shifting expectations around global monetary policy.
Reuters
