Gold Weakens, Hormuz Stalemate Key to Sentiment
Gold prices weakened again on Thursday (April 23), weighed down by a strengthening US dollar amid escalating Middle East tensions and uncertainty over the continuation of US-Iran talks. At 9:57 a.m. ET, spot gold fell 1.1% to US$4,690.23/oz, while gold futures fell 1% to US$4,706.31/oz.
The market considered the diplomatic path unclear despite President Donald Trump's public extension of the ceasefire. Iran stated that the US blockade must be lifted before negotiations can begin, while Washington demanded the full opening of the Strait of Hormuz. With Iran maintaining its restrictions on the strait and the US maintaining a naval blockade and surveillance of Iranian vessels, the stalemate has dampened gold buying interest.
The surge in oil prices back above US$100 per barrel has heightened concerns about an energy shock that could drive inflation and lead global central banks to consider tighter interest rates. This channel tends to be negative for non-yielding gold, especially when the dollar strengthens and makes bullion more expensive for buyers outside the US. The market also sought refuge in the dollar, which was said to be heading for its first weekly gain this month.
Pressure spread to other precious metals. Spot silver fell 3% to US$75.3725/oz, while spot platinum fell 3.5% to US$2,015.35/oz. The next focus will be on developments in Hormuz and signals regarding US-Iran negotiations, the direction of oil and energy inflation, the movement of the DXY and US yields, which will determine the recovery potential for gold. (Arl)*
Source: Newsmaker.id
