Gold saw a drop on Monday, affected by a strong dollar, while rising oil prices heightened worries about inflation and the likelihood of sustained high interest rates amid stalled U.S.-Iran peace talks. Spot gold saw a decrease of 0.3%, trading at $4,694.26 per ounce, as of 0059. Last week, the metal saw a decrease of 2.5%, marking the conclusion of a four-week streak of increases. U.S. gold futures for June delivery fell by 0.9%, closing at $4,697.60. On Sunday, U.S. President Donald Trump expressed that Iran is invited to reach out if it wishes to discuss a resolution to their ongoing two-month conflict, emphasizing that the country must never have a nuclear weapon.
This is in reply to Tehran’s claim that the U.S. must lift obstacles to an agreement, such as its blockade of Iranian ports. Trump cancelled a trip by two U.S. envoys to Pakistan, which serves as a mediator for the Iran war, on Saturday. This presents a setback to peace prospects after the Iran foreign minister left Islamabad, having engaged only with Pakistani officials. Oil prices rose, the dollar experienced a minor increase, and U.S. stock futures fell as the deadlock in U.S.-Iran peace talks prolonged the interruption of energy exports from the Middle East, creating anxiety among markets and policymakers ahead of a hectic week of central bank meetings.
On Sunday, Republican Senator Thom Tillis expressed his readiness to move forward with the Senate confirmation of Federal Reserve chair nominee Kevin Warsh, after the Department of Justice announced on Friday that it would end its investigation into Fed Chair Jerome Powell. Gold premiums in India rose last week to their highest level in two and a half months as supplies tightened, while buying interest surged in China.
SPDR Gold Trust, known as the largest gold-backed exchange-traded fund in the world, announced a decrease in its holdings by 0.2%, resulting in a total of 966.30 metric tons as of Thursday. Investors are eagerly awaiting the interest rate decision from the U.S. Federal Reserve, which will be announced after its two-day meeting on Wednesday. Spot silver fell by 0.3% to $75.48 per ounce, platinum dropped by 0.3% to $2,005.15, and palladium saw a 0.3% decrease to $1,492.22.