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Home Gold News Gold Prices Rise to Near One-Week High Amid Geopolitical Tensions and Weaker Dollar

Gold Prices Rise to Near One-Week High Amid Geopolitical Tensions and Weaker Dollar

by anna

Gold prices surged to a near one-week high on Monday, gaining 0.4% to reach $2,021.09 per ounce, its highest level since February 13. The uptick in gold prices was attributed to a slight pullback in the US dollar and escalating tensions in the Middle East, boosting the precious metal’s safe-haven appeal. US gold futures also saw a 0.4% increase, reaching $2,032.40 per ounce.

Geopolitical concerns heightened as a UK-registered cargo ship reported an attack in the Bab al-Mandab Strait off Yemen, and the UK Maritime Trade Operations agency noted a ship’s crew abandoning it after an explosion off the Yemen coast. These developments contributed to renewed traction in gold due to increased safe-haven flows.

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The dollar index, down 0.1%, made gold more affordable for overseas buyers, further supporting its rise. Analysts highlighted the significance of monitoring the Federal Open Market Committee (FOMC) minutes, scheduled for release on Wednesday, for insights into the Federal Reserve’s policy outlook. Any hawkish stance from policymakers may renew concerns about higher interest rates, potentially impacting gold prices.

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Market focus remains on the likelihood of interest rate cuts, with Chicago Fed President Austan Goolsbee suggesting caution against delaying rate cuts for too long. While markets currently anticipate a 77% chance of a rate cut in June, according to the CME Fed Watch Tool, the FOMC minutes will provide additional cues on the timing and direction of future rate decisions.

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In the precious metals market, platinum fell 0.4% to $902.37, palladium rose 0.9% to $958.66, and silver experienced a 1.2% decline, reaching $23.12 per ounce. Gold’s safe-haven appeal continues to be influenced by geopolitical tensions and the broader economic outlook.

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