Gold prices rise as US-Iran tensions grow
What's the story
Gold prices witnessed a slight uptick on Monday, as investors flocked to safe-haven assets. The move comes amid fears of an escalating conflict in the Middle East, following US attacks on Iranian nuclear facilities and subsequent threats of retaliation. Spot gold rose by 0.1% to $3,371.30 per ounce while US gold futures remained steady at $3,387.20 per ounce during early trading hours today.
International reactions
World awaits Iran's response after US strikes
The world is now waiting to see how Iran will respond after the US strikes, which, alongside Israel, mark the largest Western military action against the Islamic Republic since its 1979 revolution. In a televised address, US President Donald Trump warned Iran against retaliation, saying any response would prompt further attacks unless peace was pursued.
Escalating conflict
Iran vows to retaliate, missile exchanges continue
Iran has vowed to retaliate, with missile exchanges between Iran and Israel continuing over the weekend. Israeli fighter jets targeted military sites in western Iran, while Iranian missiles injured many and destroyed buildings in Tel Aviv. The situation continues to escalate as both sides remain locked in a cycle of retaliation.
Economic uncertainty
US Fed divided on rate cuts
The US Federal Reserve is divided over whether to continue hedging against inflation risks or expedite rate cuts. This was evident in their first public comments after deciding to keep borrowing costs steady for now. The Fed's latest Monetary Policy Report to Congress said US inflation remains somewhat elevated but suggested that the full impact of Trump's tariffs is yet to be felt.
Information
Trump considers firing Fed Chair over interest rate cuts
On Friday, Trump once again suggested firing Fed Chair Jerome Powell for not lowering interest rates enough. This comes amid ongoing debates within the Federal Reserve about how to handle inflation risks and potential rate cuts.