Gold traded near $4,050 an ounce on Tuesday, holding within the $4,000–$4,100 band that has contained prices in recent weeks. Investors remained focused on uncertainty over the Federal Reserve’s interest rate path while also tracking developments in the Middle East for any signs of diplomatic progress on the Iran conflict.
New York Fed President John Williams said inflation still appears to be moving gradually lower but emphasized that the Fed would not hesitate to raise rates again if price pressures persist. At the same time, the three policymakers who dissented from last week’s decision to keep rates on hold reiterated their view that further tightening is warranted.
Futures markets now assign a 63% probability to a rate hike in September, with attention shifting to upcoming US labor market data for additional policy clues. Meanwhile, mixed messages from Washington and Tehran over negotiations to end the conflict have added to uncertainty, underpinning demand for safe-haven assets such as gold.