Safe-haven gold nears a one-month low as global tensions ease
Gold prices fell more than 1%, reaching their lowest level in about a month due to improving global sentiment and easing geopolitical tensions.
Spot gold dropped to around $3,288 per ounce, marking a weekly loss exceeding 2%.
The ceasefire between Iran and Israel reduced demand for gold as a safe-haven asset.
Progress in US-China trade talks, including an agreement to expedite rare earth shipments, helped ease market uncertainty.
Investors are closely watching upcoming US inflation data, especially the Personal Consumption Expenditures (PCE) report, to gauge the Federal Reserve’s interest rate policy.
Some analysts expect gold to stabilize near $3,300 before potentially rebounding later in the year, depending on economic and geopolitical developments
Gold Nears One-Month Low Amid Easing Global Tensions and Market Optimism
Price Movement:
Gold prices declined over 1%, hitting about $3,288 per ounce, the lowest in nearly a month.
This marked a weekly drop of roughly 2.3%, reflecting decreased investor demand for traditional safe-haven assets.
Geopolitical Factors:
The recent ceasefire between Iran and Israel, brokered diplomatically, has significantly reduced geopolitical risks that usually boost gold prices.
This reduction in uncertainty encouraged investors to move funds from gold into riskier assets like stocks.
Trade and Economic Developments:
Positive progress in U.S.-China trade relations, particularly an agreement to accelerate shipments of rare earth metals crucial for technology industries, has further improved market confidence.
Investors are now focused on upcoming U.S. inflation figures—especially the Personal Consumption Expenditures (PCE) report—which could influence Federal Reserve interest rate decisions.
The probability of a rate cut in July has increased recently, adding complexity to gold’s near-term price dynamics.
Market Sentiment & ETFs:
Exchange-Traded Funds (ETFs) tracking gold showed mixed movements: while some gold miners’ ETFs rose slightly, the major gold-backed ETFs experienced small declines, reflecting investor caution.
Analysts anticipate that gold prices may consolidate around the $3,300 level in the short term before potential upward movement later in 2025, depending on evolving economic indicators and geopolitical events.