Gold Holds Steady Amid Renewed War Tensions
Gold prices have held steady in early trading on Friday after a reported Iranian attack in the Strait of Hormuz sparked concerns about the impact on interest rates. The precious metal was trading around US$4,245 an ounce, down from the previous session's 0.2% decline.
The attacks, which saw Iran strike 'hostile targets' in the critical waterway, have revived speculation that the Federal Reserve may need to raise borrowing costs to contain consumer prices. Higher rates are typically negative for gold as it pays no interest.
US President Donald Trump told reporters on Thursday that he thinks the war will end 'pretty soon' and that the US is in control of the strait, but the late-week ratcheting up of tensions has tempered optimism about a quick resolution.