Gold prices fell slightly in Wednesday's trading session as investors continued to monitor tensions between the US and Iran, while waiting for statements from Fed officials to find more signals about monetary policy.
As of 4:14 PM Vietnam time, spot gold prices fell 0.25% to 4,490.85 USD/ounce. US gold futures for June delivery also fell 0.4% to 4,485.70 USD/ounce.
Mr. Ilya Spivak - Head of Global Macro Division at Tastylive - said that the general trend of gold is still leaning towards depreciation, even though the market continuously experiences prolonged accumulation periods.
It seems the overall trend is still downward, but the market is experiencing quite long accumulation phases and this may be the current state of gold," he said.
According to Mr. Spivak, the market is currently increasingly focused on whether the US and Iran can make a real breakthrough in the negotiation process.
Iran on Tuesday accused the US of violating the ceasefire after conducting airstrikes targeting targets near the Strait of Hormuz - a disputed area, a move that could make efforts to end the conflict more complicated.
US Secretary of State Marco Rubio said that the negotiation process to reach a ceasefire agreement may take "a few more days", although both sides previously sent positive signals about an initial agreement to end fighting and restore transportation through the Strait of Hormuz.
Investors are currently awaiting statements from Fed officials, including Vice Chairman Philip Jefferson and Governor Lisa Cook, to assess the impact of inflation on monetary policy orientation in the coming time.
In addition, the US Personal Consumption Expenditure (PCE) index data for April - the Fed's preferred inflation measure - expected to be released on Thursday - is also being closely monitored by the market.
Mr. Spivak said that inflationary pressure and volatility in the bond market are currently so great that the market no longer focuses too much on the yield factor of gold as before.
According to him, if the current trend continues, gold prices may even fall to the $3,700–$3,800/ounce range by the end of this year.
On other precious metals markets, spot silver prices fell 2.6% to 74.97 USD/ounce. Platinum prices fell 1.8% to 1,922.58 USD/ounce, while palladium fell 1.1% to 1,364.19 USD/ounce.
