Gold steady as investors focus on US-Iran peace talks

Synopsis

Gold prices held steady as U.S.-Iran peace talks progressed, offering a glimmer of regional stability. However, escalating expectations of a December Federal Reserve interest rate hike cast a shadow over the precious metal. Traders are now betting heavily on a rate increase, influencing market sentiment. Other precious metals saw mixed movements.

Gold prices were steady on Tuesday as investors assessed U.S.-Iran peace talks, while rising expectations of a Federal Reserve interest rate hike in December weighed on the metal.

FUNDAMENTALS

Spot gold was steady at $4,191.09 per ounce, as of 0053 GMT. U.S. gold futures for August delivery rose 0.2% to $4,208.40.

The ‌United States ⁠waived sanctions ⁠on Iran for 60 days from Monday after the first talks under a nascent peace deal, while officials reported a sustained lull in fighting in Lebanon under the agreement aimed at ending hostilities across the region.

U.S. Vice President JD Vance said talks with Iranian officials in Switzerland had laid a good foundation for a final ⁠peace deal, ‌although Iran denied that it had begun discussions of its nuclear programme.

Fed Chairman Kevin Warsh will deliver his ⁠first testimony on monetary policy before Congress on July 14, according to a hearing notice published by the House Financial Services Committee.

Chicago Fed President Austan Goolsbee said that with the labour market stable, he is focused on figuring out whether too-high inflation will stay that way or if it will recede as the effect of high tariffs fades and if ‌the conflict in the Middle East gets resolved.

Traders now see an 89% chance of an interest rate hike in December, up from 61% ⁠before the Fed meeting last week, according to the CME FedWatch Tool. [FEDWATCH/]

Gold speculators raised net long positions by 9,258 contracts to 112,918 in the week to June 16. [CFTC/]

Spot silver fell 0.4% to $64.92 per ounce, platinum lost 0.4% to $1,672.90, while palladium was up 0.1% at $1,266.35.

DATA/EVENTS (GMT)

0730 Germany S&P MFG, Services, Composite Flash PMI Jun

0800 EU S&P Mfg, Services, Composite Flash PMI Jun

0830 UK Flash Composite, Manufacturing, Services PMI Jun

1345 US S&P Global Mfg, Svcs, Comp PMI Flash Jun

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