Gold prices rose on Tuesday as oil prices declined amid signs of diplomatic efforts to ease tensions between the United States and Iran, while investors also continued to assess the risk of another surge in crude oil prices.
Spot gold gained 0.5% to $4,023.56 per ounce, while U.S. gold futures for August delivery rose 0.3% to $4,028.00 per ounce.
Oil prices fell as markets weighed reports of mediation efforts between the United States and Iran against renewed exchanges of attacks between the two sides, as well as threats by Yemen’s Houthis to impose a naval blockade on Saudi Arabia.
The latest escalation in the Middle East conflict pushed oil prices on Monday to their highest level in more than a month. At the same time, a growing number of policymakers have argued that another interest rate hike may be needed to curb persistent inflation, setting the stage for a closely watched debate at the Federal Reserve’s next policy meeting.
Higher interest rates increase the opportunity cost of holding non-yielding assets such as gold.
In Moscow, Russia’s central bank announced that the country’s gold reserves stood at 73.4 million ounces, or 2,282 metric tons, as of July 1, down by 1.4 million ounces, or 43.5 metric tons, since the beginning of the year.
Among other precious metals, spot silver rose 0.9% to $56.93 per ounce, platinum fell 0.2% to $1,591.22 per ounce, and palladium gained 0.3% to $1,256.68 per ounce.
Source: Reuters
