Gold prices edged higher on Wednesday as the US dollar softened, while investors monitored US-Iran peace talks and Federal Reserve policy for further direction. Spot gold rose 0.2% to $4,516.76 per ounce, and US gold futures for June delivery advanced 0.3% to $4,516.30.
Gold Rate Today: Domestic Prices
In the national capital, gold prices tumbled by Rs 2,800 to Rs 1.62 lakh per 10 grams on Tuesday as escalating military tensions between Washington and Tehran pushed investors towards the safety of the US dollar. According to the All India Sarafa Association, gold of 99.9% purity declined by Rs 2,800 to Rs 1,62,400 per 10 grams, inclusive of all taxes. The yellow metal had settled at Rs 1,65,200 per 10 grams on Monday.
Silver Rate Today: Spot Silver Gains
Spot silver gained 0.6% to $77.40 per ounce, platinum remained largely unchanged at $1,957.75, while palladium rose 0.9% to $1,391.68.
What the Market is Focusing On
US consumer confidence weakened in May as concerns grew over inflationary pressures linked to the Iran conflict. Households also remained largely pessimistic about labor market conditions, although many expected improvement later in the year. Investors are now awaiting comments from Federal Reserve officials, including Philip Jefferson and Lisa Cook, for further clues on how inflation may shape future monetary policy decisions. Market participants are also focused on the upcoming US Personal Consumption Expenditures (PCE) data for April, scheduled for release on Thursday, which could provide additional insight into the Federal Reserve’s policy trajectory. UBS reduced its year-end gold price target by $400 to $5,500, citing continued risks from elevated bond yields and a stronger dollar.
Dollar Softens
The softer dollar made gold cheaper for buyers holding other currencies, lending support to bullion prices. Iran said on Tuesday that the United States had breached the ceasefire by carrying out strikes near the disputed Strait of Hormuz, potentially complicating attempts to end the conflict. Meanwhile, Marco Rubio said it may take a few days to finalise an agreement to stop the war, despite earlier indications from both sides that progress had been made toward an initial framework aimed at ending hostilities and reopening shipping routes through the Strait.
International Gold Prices Move Up
Gold prices moved slightly higher on Wednesday, aided by a weaker US dollar, as investors monitored developments in peace talks between the United States and Iran while also evaluating the outlook for US Federal Reserve policy. Analysts said sentiment for gold weakened after reports emerged of fresh US military strikes in southern Iran despite ongoing negotiations in Qatar aimed at preserving the seven-week-old ceasefire. The United States Central Command stated that the operations were defensive in nature and did not indicate the collapse of the ceasefire arrangement. Meanwhile, Iran’s Islamic Revolutionary Guard Corps claimed it had shot down a US drone that allegedly entered Iranian airspace, adding further uncertainty to the already fragile negotiations. The renewed tensions pushed crude oil prices higher, reviving concerns that elevated energy costs could sustain inflationary pressures globally and force central banks to maintain tighter monetary policy for longer.
