TLDR
- Spot gold is little changed at $4,715.45 per ounce as investors watch the fragile U.S.-Iran ceasefire
- Gold has fallen more than 10% since the Middle East war began on February 28
- Israel launched heavy strikes on Lebanon, killing hundreds, raising fears of wider conflict
- Federal Reserve March minutes showed more policymakers support rate hikes to fight inflation
- U.S. PCE inflation data is due Thursday at 1230 GMT, with CPI data to follow Friday
Gold prices were steady on Thursday as investors kept a close eye on the U.S.-Iran ceasefire and waited for fresh U.S. inflation data later in the day.
Spot gold was little changed at $4,715.45 per ounce as of 0716 GMT. U.S. gold futures for June delivery fell 0.8% to $4,739.40.
GoldSilver Central Managing Director Brian Lan said gold does not appear ready to make a big move right now. He pointed to ongoing speculation about what comes next after the ceasefire.
Lan expects gold to consolidate between $4,607 and $4,860 in the near term.
The ceasefire between the U.S. and Iran remains fragile. President Donald Trump said he would keep military assets in the Middle East until a full peace deal is reached.
Trump also warned of a major escalation if Iran failed to comply with the terms.
On Wednesday, Israel launched its heaviest strikes yet on Lebanon. Hundreds of people were killed, and Iran threatened retaliation.
Gold’s Slide Since the War Began
Spot gold has dropped more than 10% since the war started on February 28. Higher energy prices have pushed up inflation concerns, which has caused markets to lower their expectations for interest rate cuts.
Rate cuts tend to benefit gold because it pays no yield. When rates are expected to stay higher for longer, gold becomes less attractive to investors.
Oil prices rose Thursday on concerns that supply from the Middle East may not fully recover. Doubts remain about whether the two-week ceasefire will hold.
Fed Minutes Signal Possible Rate Hikes
Minutes from the Federal Reserve’s March 17 to 18 meeting showed growing support among policymakers for rate hikes. Inflation has continued to run above the Fed’s 2% target.
This adds pressure on gold, which tends to struggle in a high-rate environment.
U.S. Personal Consumption Expenditures data for February is due at 1230 GMT on Thursday. March consumer price data follows on Friday.
Both reports could give clearer signals on the Fed’s next move on interest rates.
Standard Chartered said in a note Wednesday that beyond near-term liquidity needs, it expects gold to rebuild its gains in coming months due to heightened geopolitical risk.
Among other metals, spot silver fell 0.3% to $73.93 per ounce. Platinum dropped 1.2% to $2,005.71, while palladium edged up 0.3% to $1,558.68.
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