Gold prices edged lower on Monday to a one-week low as inflation worries re-emerged following the collapse of the latest U.S.-Iran peace talks.
Spot gold fell as much as 2.2% to below $4,650 an oz. — erasing all its gains from last week. By 1 p.m. ET, it had recovered to around $4,733 an oz., down 0.4% on the day.
Meanwhile, oil prices and the dollar both rallied on U.S. President Donald Trump’s order to blockade the Strait of Hormuz, after weekend talks to end the Middle East conflict failed to materialize.
The latest development reignited fears of a prolonged energy shock and high inflation, adding to investor expectations of tighter monetary policy for the foreseeable future. Such a scenario adds pressure to non-yielding assets such as gold.
At the moment, money markets only see about a 21% chance of a U.S. rate cut by the end of this year, down from 40% previously.
Be the first to comment on "Gold price edges lower after failed US-Iran peace talks"