Safe Haven Stuck, Gold Remains Unrecovered
Gold prices remained weak in Monday's Asian trading session, with XAU/USD hovering around US$4,070 per troy ounce. Pressure arose after clashes between the United States and Iran around the Strait of Hormuz pushed oil prices higher and rekindled concerns about global inflation.
Rising oil prices are a major market concern as they could increase pressure on energy costs and make it more difficult to reduce inflation. This has prevented gold from strengthening significantly, even though geopolitical tensions typically boost demand for safe-haven assets. Investors remain cautious while monitoring the latest developments in the Middle East and their impact on global risk sentiment.
Although still in the negative zone, gold pared some of its losses after the US and Iran reportedly agreed to a temporary ceasefire ahead of peace talks in Doha, Qatar. This agreement somewhat eased market concerns after the two countries previously engaged in retaliatory attacks following an incident in the strategic Strait of Hormuz.
In addition to geopolitical factors, gold is also still under pressure from expectations that the Federal Reserve will maintain its hawkish stance. High interest rates tend to reduce gold's appeal because the precious metal does not provide a yield. Market focus is now on this week's US labor data, particularly Nonfarm Payrolls, which is expected to provide important clues to the direction of the Fed's next interest rate policy. (Asd)*
Source: Newmaker.id
