Gold Awaits Clarity on Hormuz
Gold prices traded within a narrow range during Asian trading on Tuesday (August 4). Spot gold hovered around US$4,052.81 per troy ounce, following a modest 0.2% gain in the previous session.
Markets remain on the lookout for developments regarding talks to reopen the Strait of Hormuz. A normalization of shipping could boost energy supplies, weigh on oil prices, and alleviate the inflation concerns that have previously capped gold's gains.
US President Donald Trump has described the diplomatic overture as a final opportunity for Iran. However, Tehran has denied engaging in direct negotiations with Washington, acknowledging only progress in talks with Oman concerning safe passage for vessels.
On the monetary front, New York Fed President John Williams deemed current interest rates appropriate, given expectations that inflation will moderate in the second half of the year. The Fed had previously maintained rates in the 3.50%–3.75% range, despite three officials favoring a 25-basis-point hike.
Citi Research projects that gold prices may trade sideways or weaken over the coming month before rallying toward US$4,500 in the fourth quarter. This outlook hinges on the resolution of the conflict, a weaker dollar, and a decline in real interest rates.
Newsmaker Analysis: Gold is likely to remain in a consolidation phase pending clarity on the Strait of Hormuz and the direction of Fed policy. The US$4,050 mark serves as a pivotal level, with resistance at US$4,080–US$4,100 and subsequent support at US$4,020–US$4,000. (gn)
Source: Newsmaker.id
