FX.co ★ Gold Steadies as Middle East Tensions Weigh on Markets

Gold pared earlier losses to trade flat around $4,170 per ounce on Tuesday, as investors weighed escalating tensions in the Middle East and looked ahead to the Federal Reserve’s June meeting minutes for policy guidance. The metal had climbed to a two-week high on Monday after a weaker-than-expected US jobs report prompted markets to scale back expectations for imminent interest rate hikes. Still, stubborn inflation has reinforced the likelihood that the Fed will stick to a “higher for longer” approach, with futures markets pricing in about a 60% probability of a rate increase in September.

In energy markets, oil prices inched higher after two tankers were attacked in the Strait of Hormuz, while Iran warned it would withdraw from peace talks unless President Trump stopped issuing repeated threats to restart the war.

Elsewhere, China extended its gold-buying campaign to a 20th consecutive month, lifting its reserves to 75.44 million ounces. Hong Kong, meanwhile, launched a new gold clearing system and revived gold futures trading as part of a broader push to strengthen its position as a regional financial hub.