Gold Consolidates After Volatility
Gold held steady above US$4,500 per troy ounce on Monday (June 1) after a volatile week. This relatively flat movement reflects the market still weighing geopolitical risks, particularly regarding efforts to reach a longer-term ceasefire agreement between the United States and Iran.
Over the weekend, Washington and Tehran reportedly exchanged proposals to amend several parts of the draft agreement. The goal is to extend the ceasefire and reopen the Strait of Hormuz, but the direction of the talks remains unclear, and there is no certainty whether the negotiations are truly moving towards a resolution.
President Donald Trump reiterated his demand that Iran halt its nuclear program. He also emphasized the importance of restoring the Strait of Hormuz as an open international shipping lane, given that the strait is one of the most strategic chokepoints for global energy flows.
Meanwhile, gold has faced pressure since late February. Tensions in the Middle East have driven energy prices up sharply, raising concerns that inflation could rise again. If inflationary pressures persist, the market tends to assess the scope for interest rate tightening, which typically acts as a headwind for gold as it boosts the appeal of interest-bearing assets.
The combination of these two themes puts gold in a "tug-of-war" position: geopolitical risks support hedging interests, while inflation risks and the potential for higher interest rates restrain further gains. Therefore, the current stability in gold prices reflects a consolidation phase following volatility, rather than the disappearance of a driving factor.
Market participants now await the release of the US monthly jobs report, scheduled for later this week. This data has the potential to provide important clues about the strength of the labor market and how the Federal Reserve's future policy path will be interpreted by the market—two factors that could alter interest rate expectations, dollar movements, and ultimately the direction of XAU/USD. (asd)*
Source: Newsmaker.id
