Gold climbed in Asian trade on Tuesday following a volatile session, as market attention centered on a possible de-escalation in the U.S.-Israel war with Iran and the risk of disruptions to oil supplies.
Spot gold rose 0.9% to $5,180.95 an ounce by 21:58 ET (01:58 GMT), while gold futures advanced 1.7% to $5,190.86/oz. Spot prices had logged wild swings in the previous session before recording a modest gain on Monday.
The move higher in bullion accompanied a broader improvement in risk appetite after U.S. President Donald Trump said the Iran conflict will end soon. Trump also said Washington was considering steps to help temper the spike in oil prices, comments that coincided with a pickup in demand for risk assets.
Iran responded to those remarks by stating that it will decide when the war ends. The country had retaliated against U.S.-Israeli strikes by launching attacks on several surrounding Middle Eastern countries, while also attacking ships in the Strait of Hormuz.
Even with recent gains, gold remained firmly inside the $5,000-$5,200/oz trading range that has been in place over the past week, as traders processed a mix of geopolitical uncertainty and broader economic unknowns.
Analysts noted a tension in market drivers: while the Iran conflict has supported haven demand for gold, the inflationary pressures from such a conflict could push major central banks toward more hawkish policy responses, potentially limiting gold’s upside.
ANZ analysts pointed out that this year’s rally in gold had been accompanied by profit-taking, with investors also seeking liquidity amid a deep rout in global equity markets.
Other precious metals strengthened on Tuesday. Spot silver jumped nearly 6% to $89.1915/oz, and spot platinum rose 0.7% to $2,201.48/oz. Among industrial metals, LME copper futures were up 1.3% at $13,095.30 a tonne.
Key points
- Gold rose amid improved risk appetite and remarks from President Trump suggesting the Iran conflict will end soon - impacting safe-haven demand and energy-sensitive markets.
- Despite gains, gold remained in a $5,000-$5,200/oz range established over the past week - reflecting persistent market uncertainty and liquidity considerations.
- Other metals also advanced: spot silver up nearly 6%, spot platinum up 0.7%, and LME copper futures climbed 1.3% - affecting industrial and precious metals sectors.
Risks and uncertainties
- Geopolitical developments in the Iran conflict remain uncertain - directly affecting oil supply risk perceptions and safe-haven flows.
- Rising inflationary pressures from conflict-related oil price spikes could prompt more hawkish stances from major central banks - a factor that could cap gold’s gains.
- Profit-taking and liquidity needs amid a deep rout in global equity markets could add downward pressure on precious metals despite haven demand.