Gold prices fell on Monday as oil prices surged following renewed hostilities between the United States and Iran, while the precious metal faced further pressure from expectations of US Federal Reserve interest rate hikes.
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Spot gold fell 0.5% to $4,067.99 per ounce by 00:45 GMT. US gold futures for August delivery lost 0.4%, dropping to $4,081.20.
Iran had launched missiles and drones at Kuwait and Bahrain early Sunday, shortly after US President Donald Trump threatened to eliminate the Iranian leadership if it did not comply with an agreement to end the war.
However, Axios reported on Sunday that Tehran and Washington have since agreed to halt the latest wave of hostilities in Iran and resume talks regarding their dispute over the Strait of Hormuz.
Oil prices advanced on Monday following days of traded strikes between the United States and Iran in the Middle East, highlighting the fragility of their interim agreement to end the war and once again slowing the flow of energy shipments through the Strait of Hormuz.
According to the CME FedWatch Tool, traders are anticipating three interest rate hikes from the Federal Reserve this year, pricing in an approximately 77% probability of a rate hike in December.
As for other precious metals, spot silver dropped 1.1% to $58.49 per ounce, platinum rose 0.4% to $1,620.15, and palladium fell 0.4% to $1,204.25.
Reuters
