Gold Resurfaces Above $5,000, Middle East Leads
Gold strengthened for the third consecutive day, moving back above $5,000 per ounce, as market participants weighed rising geopolitical risks in the Middle East. The main driver came from increased demand for safe-haven assets amidst uncertainty surrounding geopolitical headlines.
The market was closely monitoring US President Donald Trump's statement giving Iran a 10-15-day deadline to reach a nuclear deal. This tension helped maintain interest in gold, although daily movements remained cautious as investors awaited US inflation data.
On the other hand, gold's upward trajectory was not entirely smooth, as the US dollar strengthened, approaching a near one-month high. This strengthening dollar made gold more expensive for non-dollar buyers and potentially limited upside, leaving gold vulnerable to a tug-of-war in the psychological $5,000 area.
The next focus will be on the release of Personal Consumption Expenditures (PCE), the Fed's favorite inflation indicator. This data is considered crucial because it can change market expectations regarding the direction of interest rates—and usually directly impacts the dollar and gold prices.
In terms of policy sentiment, the minutes of the recent Fed meeting showed that some policymakers remain wary of inflation, even opening up room for tightening if price pressures persist. Therefore, even though gold is strengthening, the market remains selective and is waiting for "confirmation" from inflation data before adding large positions.
Meanwhile, on the supply side, Newmont (the world's largest gold producer) stated that its gold production outlook for 2026 is likely to decline compared to 2025, in line with planned mining work and capital expenditures for its assets. This supply factor is also of concern because it could add to the bullish narrative for gold amidst high market volatility.
Source: Newsmaker.id
