Gold Stagnates as Market Weighs Fed's Next Move
Gold prices fluctuated during Monday's trading (Aug 3) as investors weighed the Federal Reserve's interest rate trajectory following the easing of tensions in the Middle East. Gold traded around US$4,050 per troy ounce after recording a 1% gain throughout July.
Market sentiment improved after U.S. President Donald Trump called off a planned strike against Iran. Trump stated that new talks would begin after several U.S. allies in the Middle East, including Saudi Arabia, asked Washington to give diplomacy a chance.
The easing of conflict risks caused U.S. oil prices to fall, closing near US$80 per barrel. Lower energy costs helped alleviate inflation concerns, thereby dampening expectations that the Fed would need to raise interest rates aggressively.
However, gold is not yet entirely free from pressure. Interest rates that could remain high may boost the appeal of bonds and reduce interest in non-yielding assets like gold. Uncertainty regarding the outcome of U.S.-Iran diplomacy also kept investors cautious.
Spot gold ultimately edged down 0.2% to US$4,054.95 per troy ounce. Meanwhile, silver rose 0.9% to US$58.12, while platinum and palladium weakened. The U.S. dollar index remained relatively flat.
Newsmaker Analysis: Gold remains in a consolidation phase. Declines in oil prices and yields could support prices, but waning demand for safe-haven assets limits gains. The US$4,050 level serves as the nearest support, while the US$4,080–US$4,100 range acts as the primary resistance. (arl)
Source: Newsmaker.id
