Gold prices edged lower in Thursday’s Asian session, pressured by a stronger dollar and renewed hawkish signals from the Federal Reserve. Spot gold declined 0.5% to $3,353.92 an ounce, while August futures dropped 1.1% to $3,369.77 by 06:00 GMT.
At its latest policy meeting, the Fed kept rates unchanged but paused plans for rate cuts, citing persistent inflation concerns—largely tied to tariffs and global trade disruptions. The tone of the decision fueled strength in the U.S. dollar, increasing the opportunity cost of holding non-yielding assets like gold.
Despite rising geopolitical tensions in the Middle East, gold failed to gain momentum as macroeconomic forces kept bullion capped.
Fed takeaways impacting gold markets:
- Rates held steady with no immediate cut timeline
- Inflation concerns remain elevated
- Dollar strength diminishes gold’s appeal
Middle East Tensions Add Geopolitical Support
Ongoing hostilities between Israel and Iran continue to keep risk sentiment fragile. According to a Bloomberg report, U.S. officials are preparing for a potential military strike on Iran, possibly within days.
This comes after Iran’s Supreme Leader, Ayatollah Ali Khamenei, rejected demands for unconditional surrender from President Donald Trump, escalating tensions. Trump later stated that military action was possible, but not yet confirmed.
While these developments usually bolster safe-haven assets, the impact on gold has been muted due to the Fed’s stance and a firmer dollar.
Geopolitical events driving investor caution:
- Reports of imminent U.S. military action in Iran
- Iranian leadership’s defiance toward U.S. demands
- Elevated risk but capped bullion gains
Platinum Soars to $1,313 on Supply Shortage
While gold slipped, platinum surged to its highest level since September 2014, reaching $1,313.00 an ounce before easing 0.5% in late trade. The rally follows a bullish industry report released in late May, forecasting continued demand strength amid tightening supply conditions.
High lease rates and low inventories are constraining availability, while robust demand from Chinese jewelers and industrial manufacturers is amplifying the squeeze.
Key drivers of platinum’s surge:
- Supply constraints from low inventories
- Strong demand in jewelry and industrial sectors
- Rising investor interest as gold alternatives grow
Meanwhile, broader metal markets fell in response to the Fed’s dollar-friendly tone:
- Silver: -1.5% to $36.665/oz
- LME Copper: -0.3% to $9,644.35/ton
- U.S. Copper: -0.7% to $4.8205/pound