Gold prices traded in the red at around $4,700 as market players remained cautious about the US-Iran peace plan to temporarily ease the conflict that has lasted almost two months, as well as triggering global inflationary pressures.
At 9 am, gold prices were trading at $4,743, up 0.10% since it opened in early trading Thursday in the Asian session.
US President Donald Trump stressed that the ceasefire agreed on April 7 is expected to remain in place as Washington awaits a new peace proposal from Iran. However, Tehran does not appear ready to return to the negotiating table anytime soon.
This development also thwarted the plans of US Vice President JD Vance, who was scheduled to travel to Islamabad to continue negotiations.
Despite the extension of the ceasefire, tensions remain high following the naval blockade of the Strait of Hormuz and the stalled peace talks.
Disruptions to the world’s major energy trade routes continue to push up global energy costs, fueling inflation concerns and making it more difficult to see interest rate cuts.
In an environment of geopolitical uncertainty, gold remains a preferred hedge for investors.
However, its non-interest-bearing nature makes it less attractive when interest rates are high.
Markets are now focused on any new developments in the US-Iran talks. Any positive sign of peace could weaken the US Dollar and support a near-term rally in commodity prices.
