Washington, USA – Gold prices declined during trading on Tuesday, affected by the rise of the US dollar index to levels close to its highest level in a whole month, while investors are very cautiously awaiting the expected decision of the US Federal Reserve on interest rates, and what the statement may contain in terms of signals and guidance on the future course of monetary policy for the country.
Performance of spot and futures contracts for gold
In trading, spot gold fell 0.7% to $4,044.81 an ounce. Similarly, U.S. gold futures for August delivery declined 0.8% to settle at $4,045.40 an ounce, amid clear selling pressure that coincided with the strengthening of the U.S. dollar.
Await the Federal Reserve meeting and Trump’s stance
The Federal Reserve concludes its regular monetary policy meeting on Wednesday, amid prevailing market expectations that interest rates will remain at their current levels, while all eyes remain on any indications or hints the central bank may give about the possibility of changing the course of interest rates during its September meeting.
In the same political context, US President Donald Trump entered the fray of the economic crisis, publicly calling on the Federal Reserve to begin lowering interest rates, and asserting in his statements that the US economy should have the lowest interest rate compared to the rest of the world to support competitiveness.
Developments in the Iranian file and their impact on the markets
In addition, the rapidly evolving political and military situation surrounding Iran has influenced market movements and hedging strategies. President Trump announced that Washington is currently engaged in “good talks” with Iran, while maintaining the threat of renewed military strikes should the ongoing negotiations fail. This coincided with drone attacks targeting areas in Saudi Arabia, Jordan, and Iraq on Monday, further escalating geopolitical tensions.
Performance of other precious metals
In other precious metals markets, most commodities collectively declined in conjunction with the drop in gold. Silver fell 1.9% in spot trading to $57.30 an ounce, platinum dropped 1% to $1,605.14, and palladium declined 1.6% to $1,271.09 an ounce amid broad pressure from the strength of the dollar.
