Gold prices remained largely unchanged on Thursday, as rising geopolitical tensions counterbalanced pressure from the Federal Reserve’s hawkish stance. Meanwhile, platinum pulled back after earlier reaching its highest level since September 2014.
The U.S. markets were closed in observance of Juneteenth.
Spot gold was down 0.1% at $3,365.79 per ounce as of 9:40 a.m. EDT (13:40 GMT), while U.S. gold futures declined 0.7% to $3,382.80. The U.S. dollar edged higher, making dollar-denominated metals more expensive for holders of other currencies.
“The Federal Reserve indicated that inflation risks remain elevated, reducing the likelihood of resuming interest rate cuts this year, which is weighing on gold prices,” said ANZ Commodity Strategist Soni Kumari.
The Fed maintained interest rates at 4.25%–4.50% on Wednesday. Although policymakers still anticipate cutting rates by half a percentage point later this year, they have moderated their overall expectations in response to a more challenging economic outlook. Fed Chair Jerome Powell cautioned against overreliance on these projections, warning of “meaningful” inflation pressures ahead amid looming import tariffs.
Geopolitical tensions escalated further overnight as Israel targeted Iranian nuclear sites, and Iran retaliated with missile strikes on an Israeli hospital. The ongoing air conflict shows no immediate signs of de-escalation.
Gold typically benefits as a safe-haven asset during periods of geopolitical and economic uncertainty. However, its appeal diminishes in a higher interest rate environment, given that it does not yield interest.
In other metals, platinum declined 3.7% to $1,269.30 after earlier surging to a near 10-year high. “Sharp rallies that break key technical levels, such as the 1,000 mark, often attract speculative buying but tend to be disconnected from fundamentals, increasing the risk of profit-taking,” Kumari noted.
Palladium fell nearly 1.1% to $1,038.56, while silver dropped 1.4% to $36.21 per ounce.
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