(June 8): Gold steadied after Iran signalled an end to its current military operations against Israel, potentially removing a major obstacle to efforts to bring an end to the wider Middle East conflict.
Bullion swung between small gains and losses in US trading hours, after giving up nearly 5% last week during the worst flare-up in regional hostilities since the truce was agreed to in early April. US President Donald Trump demanded an end to the fighting following a series of tit-for-tat strikes between Israel and Iran that threatened to derail talks aimed at ending the Middle East conflict.
Now in its fourth month, the war has disrupted energy flows via the Strait of Hormuz, driven oil prices higher and raised concerns about global inflation, making central banks more likely to keep interest rates steady or raise them — a headwind for precious metals. On Monday, Yemen’s Iranian-backed Houthis also announced a blockade of Israeli ships in the Red Sea.
Key issues concerning the conflict in the Middle East remain "unresolved", Rhona O’Connell, head of market analysis at StoneX Group Inc, said in a note. “Our belief in a downward bias is, so far, being vindicated, but we are keeping our eyes open for any bargain hunting.”
Gold slid 0.2% to US$4,319.89 an ounce as of 10.22am in New York. Silver rose 0.2% to US$67.95 an ounce. Platinum and palladium both fell. The Bloomberg Dollar Spot Index was little changed.
See also: Gold steadies after Israel and Iran agree to end missile strikes
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