Gold Plunges Over 3% as US-Iran Talks Boost Dollar Demand

Gold prices fell sharply on Tuesday, dropping more than 3% as the US dollar strengthened amid progress in talks between Washington and Tehran. At the time of writing, gold traded around $4,869 per ounce after briefly reaching $5,000.
Dollar Strength Pressures Gold
The rise of the US dollar reduced demand for gold, traditionally seen as a safe-haven asset. At the same time, stable US government bond yields added further pressure, making gold less attractive to investors.


Strong US Data Cools Fed Rate Cut Bets


Recent reports showed steady job growth and healthy business activity, which lessened expectations for additional interest rate cuts from the Federal Reserve. Investors responded by moving away from gold toward the stronger dollar.


Geopolitics Shift Market Mood


Signs of progress in US-Iran nuclear talks encouraged investors to reduce safe-haven positions. The news also added caution in broader markets, as traders adjusted to both improving conditions and ongoing uncertainties around global conflicts.


Gold Faces Short-Term Pressure


Gold struggled to hold above $5,000, sliding below $4,900. This short-term weakness reflects changing sentiment rather than a broader trend. A rebound above $5,000 would be needed to restore confidence.


What Investors Should Know


Gold remains a key hedge during uncertain times, but its price can move sharply in response to news and market sentiment. Investors may consider balancing their holdings with other assets while keeping an eye on developments in geopolitics and the US economy.