Gold prices edged lower in volatile trading on Thursday, as surging oil prices exacerbated inflation fears and expectations that interest rates would remain elevated. Meanwhile, investors awaited clarity on the potential path for peace talks between the United States and Iran.
اضافة اعلان
By 02:15 GMT, spot gold fell 0.7% to $4,705.09 per ounce. U.S. gold futures for June delivery slipped 0.6% to $4,722.10.
Brent crude prices remained above $100 per barrel following a larger-than-expected decline in U.S. gasoline and distillate inventories, coupled with a lack of progress in peace negotiations.
"Brent crude returning above $100 keeps inflation concerns at the forefront, putting gold on the defensive today," said Tim Waterer, chief market analyst at KCM Trade.
Rising oil prices can fuel inflation by increasing transport and production costs, which in turn raises the likelihood of higher interest rates. While gold is traditionally considered a hedge against inflation, higher interest rates make yield-bearing assets more attractive, dampening the appeal of the non-yielding precious metal.
The situation remains tense as Iran seized two vessels in the Strait of Hormuz on Wednesday, tightening its grip on the strategic waterway. This followed U.S. President Donald Trump's decision to extend the ceasefire indefinitely, though without any sign of resuming peace talks.
Trump has maintained the U.S. Navy’s blockade on Iranian maritime trade. Mohammad Bagher Ghalibaf, Speaker of the Iranian Parliament and chief negotiator, stated that a full ceasefire is "meaningless" unless the blockade is lifted.
"Investors are concerned that the current status quo of a 'ceasefire with a blockade' could persist for months, turning a short-term spike into a long-term inflationary factor, which would hurt gold from a yield perspective," Waterer added.
According to a Reuters poll of economists, the Federal Reserve is expected to wait at least six months before any interest rate cuts this year, as war-induced energy shocks further stoke already high inflation.
Traders are now pricing in a 23% chance of a 25-basis-point rate cut in December, down from 28% a week ago. Before the conflict, there were expectations for two rate cuts this year.
As for other precious metals:
Spot silver fell 1.4% to $76.64 per ounce.
Platinum lost 1.3% to $2,048.25.
Palladium dropped 1% to $1,529.25.
— Reuters
