During the Asian trading session on Monday, the spot price of gold fell sharply from its intraday peak, as escalating conflict in the Gulf region pushed oil prices higher and intensified inflation concerns. Iran's launch of multiple missiles toward Israel and Israel's retaliatory actions have contributed to rising oil prices and put downward pressure on gold.
The price of gold touched a low of $4,300.06 per ounce, representing a significant drop of $53 from the earlier intraday high of $4,353.38 per ounce.
Last Friday, gold prices fell by approximately 3% following a stronger-than-expected U.S. jobs report, which fueled market expectations for interest rate hikes.
On Sunday, Iran launched missiles at Israel in retaliation for an Israeli airstrike in Beirut earlier that day. This marks the first direct missile attack by Iran on Israel since a ceasefire on April 8. The action signifies a major escalation in regional tensions and could lead to a breakdown in U.S.-Iran negotiations, potentially reigniting conflict.
Former U.S. President Donald Trump stated that he still hopes to resolve the conflict with Tehran through negotiation.
In Monday's Asian session, oil prices rose by more than $2 per barrel, exacerbating concerns about inflation and potential interest rate increases.
Cleveland Fed President Beth Hammack stated last Friday that the latest employment data indicates the labor market is roughly balanced and near full employment, while persistently high inflation may require the Federal Reserve to raise interest rates sooner to control it.
Gold itself does not yield interest, so when interest rates remain elevated, it can diminish the metal's appeal.
Since the outbreak of conflict in Iran in late February, the price of gold has fallen by approximately 15%.
Israel Confirms Airstrikes on Iran, Explosions Heard in Multiple Cities
According to the latest report from Fox News, the Israel Defense Forces confirmed that airstrikes were carried out in western and central Iran on Sunday.
The Israeli military stated in a declaration that the Israeli Air Force executed the attack.
The statement read, "A short while ago, the Israeli Air Force struck targets of the Iranian terror regime in western and central Iran." It added that further details would be provided later.
Additionally, local media reports indicated that explosions were heard in Tehran, Tabriz, and Isfahan.
Israel's airstrikes occurred several hours after Iran launched a wave of ballistic missiles toward northern Israel.
According to state media reports, Iran's Revolutionary Guard Corps stated that Israel used "air-launched" ballistic missiles to carry out attacks on targets within Iranian territory.
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