Gold prices fall to 2.5 week low as tensions in the Middle East ease
Kyiv • UNN
Gold prices fell to a two-week low as tensions in the Middle East eased and investors waited for economic data from the United States that could affect interest rates.
Gold prices fell to their lowest level in two weeks on Tuesday as tensions in the Middle East eased and investors waited for data that could affect US interest rates, UNN reports citing Reuters.
Details
Spot gold fell by almost 1% to $2306.31 an ounce by 06:16 GMT (09:16 Kyiv time), while US gold futures fell by 1.1% to $2319.80.
"Gold has been the recipient of various types of buying flows in recent months, and now one of those flows has dried up a bit and demand for safe-haven assets is declining. Investors are looking at this as an opportunity to lock in some profits after the recent (strong) fall in gold," said Tim Waterer, chief market analyst at KCM Trade.
On Monday, gold fell by more than 2%, its biggest one-day drop in over a year. This came after Iran said it had no intention of retaliating against an attack allegedly carried out by Israeli drones, easing fears of an expanding regional conflict.
On April 12, gold hit a record high of $2431.29 per ounce. This week's main economic focus will be on the US GDP data to be released on Thursday and the personal consumption expenditures section on Friday.
"If that happens to lead to a hike, we could see further extension of the expectation of lower interest rates. Such a scenario could cause the gold price to take a bigger step backwards... in the short term from an opportunity cost perspective," Waterer said.
According to a Reuters poll, March's PCE figure is expected to rise 0.3% month-on-month, unchanged from the previous month, and show a 2.6% year-on-year increase, an increase from the 2.5% increase in February.
"The decline... may have also confounded weak long positions... fueling a larger drop," said Singapore's OCBC.
Spot silver prices fell by 1.1% to reach $26.91 an ounce. Spot platinum also dropped by 1.1% to settle at $908.30, while palladium lost 1.8% of its value, falling to $990.54.
Recall
Less than a month ago, gold prices hit a record high of $2265 per ounce as lower US inflation fueled expectations for a Federal Reserve interest rate cut in June.
