Gold prices steadied in Asian trade on Tuesday after retreating in the prior session on growing uncertainty over U.S. involvement in the Israel-Iran war, as well as a potential ceasefire.
Bullion reversed a bulk of its recent gains after reports that Iran was seeking a ceasefire spurred some risk-on sentiment on Monday. But Tehran said it will not seek a truce when under fire from Israel, while a warning from U.S. President Donald Trump also ramped up concerns that an escalation in the war was imminent.
Spot gold rose 0.2% to $3,392.25 an ounce, while gold futures for August fell 0.2% to $3,410.70/oz by 01:12 ET (05:12 GMT).
Israel-Iran uncertainty builds amid Trump warning, report of US talks Trump warned on Monday evening that “everyone should immediately evacuate Tehran,” ramping up concerns that an escalation in the conflict was imminent.
But the White House clarified that the U.S. will not participate directly in the conflict, although Trump also maintained his harsh rhetoric towards Iran’s nuclear ambitions.
A report from Axios showed that Washington was still seeking dialogue with Tehran after the cancellation of nuclear talks that were scheduled over the weekend. The report said both U.S. and Iranian officials were looking to set up talks on a ceasefire and the nuclear deal this week, although no clear date was set.
Varying reports on the Israel-Iran conflict, which was triggered by Israeli strikes on Iranian nuclear facilities last week, sapped gold of some momentum gained after Israel’s initial strike. Bullion had briefly risen past $3,450/oz on Monday before sharply reversing course.
3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads. Citi analysts warned that gold was likely to sink back below $3,000/oz in the coming quarters, as a record-setting rally runs dry. Investor demand for bullion is also expected to cool.
Fed anticipation keeps metal markets down Broader metal prices fell on Tuesday, as anticipation of a Federal Reserve rate decision this week also sapped appetite for the sector.
Among other precious metals, platinum futures fell 0.1% to $1,239.90/oz, pulling back further from a stellar rally over the past month. Silver futures rose 0.2% to $36.503/oz.
Benchmark copper futures on the London Metal Exchange fell 0.4% to $9,674.75 a ton, while U.S. copper futures steadied at $4.8163 a pound.
Metal markets took little support from a softer dollar, as traders remained biased towards the greenback in anticipation of the Fed.
The central bank is widely expected to keep interest rates unchanged on Wednesday, although focus will be on Chair Jerome Powell for any cues on the path of rates this year.
