Gold Stable, Market Monitors War!
Gold prices moved steadily on Tuesday (July 21st), as market participants continued to monitor developments in the Middle East conflict. Gold traded within a narrow range around US$4,000 per troy ounce after closing slightly lower in the previous session by 0.2%.
Gold's movement was restrained as the market continued to weigh the impact of the conflict on energy prices and inflation. Oil prices remained relatively stable after two days of gains, despite the United States launching renewed attacks on Iranian targets and President Donald Trump asserting that Tehran would "pay" for the deaths of US troops.
Geopolitical risks also increased after the Iran-backed Houthi group in Yemen threatened to block Saudi Arabia's maritime routes. This threat prompted the Saudi-led military coalition to declare it had taken steps to protect shipping in the Red Sea.
However, market pressure was somewhat mitigated by diplomatic signals. Iran said mediators had contacted Tehran with a proposal to de-escalate the conflict, while reports emerged of a proposed 10-day halt to attacks.
Consequently, gold still has the potential for limited movement in the short term. War sentiment is supporting safe havens, but rising energy prices could fuel inflation and open the door to longer-term high interest rates for the Fed. As long as gold remains around US$4,000, the market will continue to await new direction in the Middle East conflict and signals from the Fed's policy stance. (asd)*
Source: Newsmaker.id
