Gold Defies Strong Dollar as Middle East Tensions and Rate Cut Hopes Fuel Demand

Gold remained steady above $5,170 as heightened tensions in the Middle East sustained investor demand for safe-haven assets. Ongoing diplomatic friction between the United States and Iran has added uncertainty to global markets, encouraging traders to seek protection in bullion despite broader currency strength.


Strong US Data Boosts Dollar but Fails to Shake Gold


The US Dollar gained ground after solid economic data signaled continued resilience in the American economy. Strong labor market conditions reduced immediate pressure for interest rate cuts. Even so, gold prices held firm, showing that geopolitical risks are currently outweighing currency-driven pressure.


Rate Cut Hopes and Trade Concerns Offer Support


Markets still expect interest rate reductions later this year, a factor that generally benefits gold. At the same time, lingering uncertainty surrounding global trade policies and the possibility of higher tariffs are keeping investors cautious. These concerns continue to provide an underlying floor for bullion prices.


Focus Shifts to Inflation Data


Investors are now turning their attention to upcoming US inflation figures, which could shape expectations for future monetary policy. A softer reading may strengthen the case for rate cuts and potentially give gold additional upward momentum.


For now, a combination of geopolitical tension, policy uncertainty, and expectations of easier monetary conditions is helping gold maintain its position above the $5,170 level.