Oil tops $110 as gold stays stable amid Iran-US tensions

Investors tread cautiously as Trump deadlines on Iran stir markets, while silver, platinum, and palladium retreat and inflation concerns weigh on precious metals.

Annahar

Gold.

Gold prices stabilized on Tuesday as investors remained cautious ahead of the deadline set by U.S. President Donald Trump for Iran to reopen the Strait of Hormuz.

Spot gold fell 0.1 percent to $4,640.93 per ounce by 03:27 GMT, while U.S. gold futures for June delivery declined 0.4 percent to $4,666.70.

Elia Spivak, Head of Global Macro at Tasty Live, a platform for trading financial derivatives, said, "Everyone is on edge, waiting to see the outcome of the sharp statements made by the president over the past few days."

Iran said on Monday that it wants a permanent end to the war with the United States and Israel and rejected pressures to reopen the Strait of Hormuz, while Trump warned that Iran could be “wiped out” if it does not meet the deadline he set for reaching an agreement, which is due by Tuesday evening.

Oil prices continued their gains, settling above $110 per barrel as Trump increased his rhetoric against Iran.

The sharp rise in oil prices has exacerbated inflation concerns. While gold typically benefits during periods of inflationary pressure, rising interest rates reduce its attractiveness as it is a non-yielding asset.

According to the CME Group's FedWatch Tool, markets largely see no chance of interest rate cuts by the US Federal Reserve this year.

Investors are now awaiting the Federal Reserve's March monetary policy meeting minutes due on Wednesday, along with U.S. inflation indicators such as the Personal Consumption Expenditures (PCE) data and the Consumer Price Index (CPI), which are set to be released later in the week.

As for other precious metals, spot silver dropped 0.9 percent to $72.17 per ounce, platinum fell 1.1 percent to $1,958.75, and palladium declined 0.5 percent to $1,478.49.