Gold prices went sideways after the US and Iran agreed to continue nuclear talks, while the US strengthening military presence in the Middle East still makes the market concerned about the risk of conflict.
Gold traded around 5,190 USD/ounce, after rising 0.4% in the previous session and is heading towards a week of price increase. Washington and Tehran will continue negotiations next week after achieving "significant progress" in Thursday's meeting, according to information from Oman, a mediating country, thereby opening up room for further diplomatic efforts. However, a source familiar with the US position said that officials left the negotiating table with disappointment about the level of progress achieved.
The US and Iran have long fallen into a tense confrontation related to the nuclear activities of this Islamic Republic and have continuously issued mutual threats, in the context of President Donald Trump ordering the deployment of the largest US military force in the Middle East since 2003. These developments have supported the upward momentum of gold prices in recent days.
Since the beginning of the year, gold prices have increased by about 20%, returning to stand firm above the 5,000 USD/ounce mark after a sharp correction from a record high at the end of January. This precious metal is on track to record its seventh consecutive month of increase, the longest increase streak since 1973. Prolonged geopolitical and trade tensions, along with the so-called "dollar depreciation" trend and concerns about the independence of the US Federal Reserve (Fed), have added momentum to the multi-year upward trend of gold.
As the market gradually stabilized, investors also increased holdings in gold-guaranteed exchange-traded funds. Capital inflows into these funds in the week leading up to Thursday far exceeded previous months' recorded selling volume.
Meanwhile, traders are also closely monitoring signals related to the Fed's next move on interest rates. Chicago Fed Chairman Austan Goolsbee said on Thursday that there is a possibility of more interest rate cuts this year if inflation cools down, while Fed Governor Stephen Miran reiterated his support for a total interest rate cut of one percentage point by 2026, despite recent data showing that the labor market is improving.
As of 9:54 am in Singapore, spot gold prices edged up 0.1% to 5.191.16 USD/ounce. Silver prices rose 1% to 89.19 USD/ounce. Platinum and palladium also simultaneously increased. The Bloomberg Dollar Spot index, a measure of the strength of the USD, rose 0.1%.
