Gold prices soared to a five-day high, surpassing the $2,400 mark, driven by escalating tensions between Israel and Iran in the Middle East conflict. An Israeli attack on Iran on Friday propelled bullion towards its peak of $2,417 per troy ounce, as investors sought refuge amidst the uncertainty surrounding the situation. However, the rally proved short-lived as Tehran announced it had no intentions of retaliating.
XAU/USD is currently trading at $2,394, reflecting a 0.70% increase, following a volatile movement of $44.00 as traders assimilated Friday’s developments. Despite recent hawkish remarks from Federal Reserve (Fed) officials, gold remains buoyed by a drop in US Treasury bond yields and a weaker Greenback. The Fed’s shift towards a more neutral stance, acknowledging a halt in the disinflationary trend, has not deterred the precious metal’s strength.
Chicago Fed President Austan Goolsbee abandoned his dovish stance on Friday, remarking that inflation progress had stalled and endorsing the Fed’s current restrictive policy. His sentiments echoed similar remarks from Atlanta Fed’s Bostic and New York Fed’s Williams, both of whom signaled a less accommodative stance during Thursday’s discussions.
Bostic, known for his hawkish views within the Federal Open Market Committee (FOMC), went a step further than Goolsbee and Williams, asserting that rate cuts were unlikely until the year’s end. Despite these hawkish comments, gold’s resilience persists amidst geopolitical uncertainties and a cautious market sentiment.
