Gold prices saw a slight decline, giving back some of the previous session's gains as market participants closely monitor developments related to a potential US-Iran ceasefire. The precious metal initially rose before falling back, ultimately trading above $4,500 per ounce. US Treasury yields remained near multi-year highs, while persistently high energy prices continue to fuel inflation concerns. Rising borrowing costs diminish the appeal of non-yielding gold. Concurrently, a 0.2% rise in the US dollar index makes the metal more expensive for many buyers. The US President stated on Monday that he had authorized a new round of strikes against Iran for this week but held back at the request of leaders from Qatar, Saudi Arabia, and the United Arab Emirates to allow more time for diplomatic efforts. Gold has been trading within a narrow range since its initial sharp decline early in the conflict. At that time, inflation fears eased on the prospect that slowing economic growth could lead to accommodative monetary policy. Since the onset of the conflict, the gold price has fallen nearly 14%. Vasu Menon, a strategist at OCBC Bank, noted that the fluid situation in the Middle East, coupled with volatility in oil prices and bond yields, could continue to weigh on gold in the near term. He added, "Given the significant political and economic transformations underway globally, which are expected to accelerate in the coming years, we still view gold as an effective hedge against global uncertainty." As of 9:13 AM London time, spot gold was down 0.5% at $4,544 per ounce; silver fell 2.2% to $76.05; platinum and palladium prices also moved lower.
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