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Gold prices fell for a tenth consecutive session in Asian trading on Tuesday, as investors continued to move away from the metal despite ongoing geopolitical tensions in the Middle East.
By 02:46 ET (06:46 GMT):
- Spot gold declined 0.7% to $4,376.04 per ounce
- Gold futures slipped 0.6% to $4,413.59 per ounce
The metal had already dropped to a four-month low in the previous session, marking a sharp reversal from earlier gains this year.
Iran denial fuels uncertainty, but fails to lift gold
Market uncertainty increased after Iran denied holding any talks with the United States, contradicting earlier statements from President Donald Trump, who had cited “productive” discussions when announcing a temporary pause in strikes on Iranian energy infrastructure.
At the same time:
- Iran launched new missile attacks on Israel
- The conflict showed no signs of de-escalation
Despite this escalation, gold failed to attract meaningful safe-haven demand, highlighting a shift in market focus.
Inflation and interest rate outlook dominate
Gold’s weakness is being driven primarily by macroeconomic factors rather than geopolitics.
Rising oil prices linked to the conflict have:
- Increased fears of persistent global inflation
- Led markets to scale back expectations for rate cuts
Investors now expect central banks, including the Federal Reserve, to keep interest rates higher for longer.
This environment is typically negative for gold because:
- It is a non-yielding asset
- Higher rates increase the appeal of bonds and other yield-bearing instruments
Strong dollar adds further pressure
The U.S. Dollar Index rose 0.4%, adding another layer of pressure on gold.
A stronger dollar:
- Makes gold more expensive for international buyers
- Reduces global demand for the metal
Broader metals also decline
Other metals followed gold lower:
- Silver: -0.4% to $68.91/oz
- Platinum: -0.3% to $1,883.05/oz
- Copper (LME): -1.4%
- U.S. copper futures: -1.3%
Outlook
Gold’s continued decline underscores a key shift in market dynamics:
inflation and interest rate expectations are now outweighing geopolitical risk.
Going forward, gold will likely remain under pressure unless:
- Inflation concerns ease
- Central banks signal a return to rate cuts
- Or financial market stress triggers renewed safe-haven demand
Until then, the metal may continue to struggle, even amid elevated global tensions.
