Gold Prices Plummet as Geopolitical Tensions Ease and Investors Await Inflation Data
Spot gold falls over 1% to lowest level in nearly a month amid reduced global tensions and anticipation of US inflation data.
BENGALURU: Gold prices declined by more than 1 percent on Friday, reaching its lowest point in almost a month.
This downturn can be attributed to the easing of geopolitical and trade tensions, as well as investors' anticipation of upcoming US inflation data, which may provide insight into the future trajectory of interest rates.Spot gold decreased by 1.4 percent to $3,282.68 per ounce at approximately 1:55 p.m. Saudi time, marking its lowest level since late May. This week alone, prices have dropped by over 2 percent and have fallen by more than $200 from their record high achieved in April.US gold futures also experienced a decline of 1.6 percent, settling at $3,294.50.The Iran-Israel ceasefire, established earlier this week through the mediation efforts of US President Donald Trump, appears to be holding steady.
Additionally, a White House official announced on Thursday that an agreement has been reached between the US and China regarding the expedited shipment of rare earth elements to the United States.
This agreement is part of a broader effort by countries to secure trade agreements before July 9th, the deadline for Trump's 'reciprocal' tariffs.According to Fawad Razaqzada, market analyst at City Index and FOREX.com, the reduction in haven demand has hindered gold from benefiting from the recent decline in the US dollar.
Razaqzada suggests that a minor pullback in gold prices would not be detrimental, as it would allow long-term technical overbought conditions to resolve, potentially leading to an increase in gold's value once macroeconomic conditions improve.Spot silver experienced a decline of 1.8 percent, dropping to $35.96.
Platinum plummeted by 5.9 percent to reach its lowest level since 2014, while palladium decreased by 1.2 percent to $1,117.96.
Commerzbank attributes the significant price increase in platinum to its discount relative to gold, which investors may find more affordable.
This downturn can be attributed to the easing of geopolitical and trade tensions, as well as investors' anticipation of upcoming US inflation data, which may provide insight into the future trajectory of interest rates.Spot gold decreased by 1.4 percent to $3,282.68 per ounce at approximately 1:55 p.m. Saudi time, marking its lowest level since late May. This week alone, prices have dropped by over 2 percent and have fallen by more than $200 from their record high achieved in April.US gold futures also experienced a decline of 1.6 percent, settling at $3,294.50.The Iran-Israel ceasefire, established earlier this week through the mediation efforts of US President Donald Trump, appears to be holding steady.
Additionally, a White House official announced on Thursday that an agreement has been reached between the US and China regarding the expedited shipment of rare earth elements to the United States.
This agreement is part of a broader effort by countries to secure trade agreements before July 9th, the deadline for Trump's 'reciprocal' tariffs.According to Fawad Razaqzada, market analyst at City Index and FOREX.com, the reduction in haven demand has hindered gold from benefiting from the recent decline in the US dollar.
Razaqzada suggests that a minor pullback in gold prices would not be detrimental, as it would allow long-term technical overbought conditions to resolve, potentially leading to an increase in gold's value once macroeconomic conditions improve.Spot silver experienced a decline of 1.8 percent, dropping to $35.96.
Platinum plummeted by 5.9 percent to reach its lowest level since 2014, while palladium decreased by 1.2 percent to $1,117.96.
Commerzbank attributes the significant price increase in platinum to its discount relative to gold, which investors may find more affordable.