Gold Rises Over 1%, Dollar Weakens After De-escalation Signals
Gold prices rose on Tuesday (March 10th) in line with a weaker US dollar, as markets assessed recent comments regarding the potential for a de-escalation in the US-Israel war with Iran. Spot gold rose around 1.2% to US$5,200.29 per ounce, while the April US gold contract rose 2.1% to US$5,210.70.
Gold's gains came as the dollar corrected from its previous rally. The DXY traded around 98.76, down around 0.41% on the day, making gold more affordable for non-USD buyers.
On the geopolitical front, markets continued to weigh uncertainty over the duration of the conflict. President Donald Trump stated that the war could be nearing an end, but did not provide a clear timeframe and continued to issue a stern warning about the risks of a blockade of the Strait of Hormuz. Iran rejected the claim and stated that it would continue the blockade until the attacks cease, keeping the risk premium on the energy route high.
Gold's rise was also shaped by the tug-of-war between energy inflation and interest rate expectations. Falling oil prices this session helped ease near-term inflation concerns, but the market still views energy risks as a factor that could alter central bank policy direction if the conflict drags on.
Source: Newsmaker.id
