Gold prices declined amid escalating inflation concerns, following unsuccessful peace talks between the US and Iran and a US plan to blockade the Strait of Hormuz, which intensified risks to global energy supplies. Prices fell by as much as 2.2%, dropping below $4,650 per ounce and erasing gains from the previous week. As the Middle East conflict entered its sixth week, weekend negotiations between the US and Iran failed to transform a fragile ceasefire into lasting peace. The US military announced it would begin blockading the Strait of Hormuz starting at 10:00 AM Eastern Time on Monday. Oil and natural gas prices surged. US President Donald Trump also stated that the US would intercept any vessels paying transit fees to Iran for safe passage through the Strait of Hormuz—a critical maritime chokepoint connecting the Persian Gulf with global markets. Prior to the war, one-fifth of the world's crude oil and liquefied natural gas passed through this strait. Stock index futures declined, while a key US dollar index rose by more than 0.4%, negatively impacting dollar-denominated gold. Soaring energy prices further heightened inflation risks, increasing the likelihood that central banks may delay interest rate cuts or even raise rates. This outlook is unfavorable for non-yielding gold. At the time of writing, spot gold was down 2.1% to $4,650 per ounce. Silver fell 3.7% to $73 per ounce. Platinum and palladium also traded lower. The US dollar spot index advanced by 0.45%.
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