Gold Stabilizes Amid Fed Rate Hike Expectations and Ongoing Middle East Tensions
Gold prices steadied on Tuesday after plummeting nearly 4% on Monday to its lowest level since August 5. The metal's decline was largely driven by rising US Treasury yields, which climbed to fresh multi-year highs of 5.28%. This increase in yields has made holding non-yielding assets like gold less attractive.
The recent bond sell-off has been fueled by heightened inflation concerns, exacerbated by the ongoing conflict in the Middle East. The Strait of Hormuz, a critical shipping route, remains a point of contention between Iran and the US, with tensions showing no signs of easing.
US President Donald Trump denied reports that his administration had offered Iran sanctions relief and access to frozen funds, stating that Washington had offered 'nothing' to end the conflict. Meanwhile, Iranian Foreign Minister Abbas Araghchi said Tehran held indirect talks with the US through Qatari mediators in New York.