Bullion opened with a small loss at around $4,600 as investors are monitoring the ongoing geopolitical tensions in the Middle East and market players await a speech from Fed John Williams early tomorrow morning (Tuesday).
At 9.45 am, gold prices were trading at $4,602, down 0.26% since it opened early Monday in the Asian session.
Geopolitical tensions in the Middle East are back in the spotlight after a Bloomberg report stated that diplomatic efforts to end the Iran conflict have yet to show solid progress.
US President Donald Trump hinted that the latest peace proposal from Tehran may not be enough, reflecting that negotiations are still fragile.
At the same time, Washington plans to guide neutral ships out of the Strait of Hormuz starting Monday, after they were trapped due to tensions in the Persian Gulf.
This move, however, received a strong reaction from Iran, which considered any US intervention as a violation of the ceasefire, thus increasing the risk of conflict to be greater.
This situation has the potential to have a direct impact on global markets. Increased tensions usually trigger inflation concerns and make it difficult for central banks to lower interest rates.
In a high interest rate environment, gold is seen as less attractive because it does not offer interest returns, although it remains a safe haven asset during geopolitical uncertainty.
Nevertheless, continued demand from central banks is expected to be a supporting factor for gold prices.
The Reserve Bank of India is seen continuing to strengthen its gold holdings by bringing home more than 100 metric tons for the third consecutive year.
As of March 2026, India's total gold reserves are estimated to reach around 880 metric tons, reflecting a long-term strategy in strengthening the country's reserves.
