Gold prices edged higher on Tuesday, supported by easing concerns over prolonged disruptions to oil shipments, as investors assess the economic implications of the conflict in the Middle East ahead of a series of monetary policy decisions by central banks this week.
Spot gold rose by 0.4% to $5,023.19 per ounce, while U.S. gold futures for April delivery increased by 0.5% to $5,027.20.
Iranian Foreign Minister Abbas Araghchi said on Monday that the Strait of Hormuz is not completely closed, noting that some vessels have managed to pass through the vital corridor.
However, oil prices remained above $100 per barrel, as the ongoing conflict involving United States and Israel against Iran has largely restricted access to the strait, leaving tankers stranded for weeks in what is considered one of the most severe disruptions to global supply.
U.S. President Donald Trump reiterated his call for countries to help reopen the passage, expressing frustration over the lack of willingness to assist.
High oil prices continue to fuel inflation by increasing transportation and production costs. While gold is traditionally viewed as a hedge against inflation, rising interest rates tend to strengthen yield-bearing assets, reducing demand for the precious metal.
The Federal Reserve is widely expected to keep interest rates unchanged for the second consecutive meeting when it announces its policy statement on Wednesday.
Central banks in the United Kingdom, the European Central Bank, Japan, Australia, Canada, Switzerland, and Sweden are also meeting this week for the first time since the outbreak of the conflict with Iran.
Among other precious metals, spot silver rose 0.6% to $81.28 per ounce, platinum gained 2.2% to $2,161.35, and palladium increased 1.4% to $1,620.45.
