FX.co ★ AKR48 | XAU/USD, GOLD

XAU/USD As oil prices rise due to tensions with Iran, gold drops by more than 2%. Rising Treasury yields put pressure on bullion around $4,500.If inflation continues, Fed officials will continue to raise interest rates. Fears that protracted hostilities between the US and Iran could lead to a second wave of inflation and force central banks to raise interest rates caused the price of gold to fall by more than 2.30% on Friday. The XAU/USD dropped to about $4,511 and is currently trading at $4,551. With the 10-year T-note coupon reaching yearly highs of 4.591%, up 10 basis points, and about to threaten the 2025 high of 4.627%, US Treasury rates are skyrocketing. The US Dollar Index (DXY), which measures how the US dollar performs in relation to the other six currencies, indicates that the greenback has followed suit, rising 0.33% to 99.19. Oil prices increased overnight after US President Donald Trump revealed that he is growing impatient with Iran, raising fears of a return to war. Bullion, which performs well in low interest rate conditions, faced a headwind after US inflation statistics reported on Tuesday and Wednesday eliminated the possibility of the Federal Reserve (Fed) lowering them. According to Prime Terminal data, the Fed is anticipated to keep rates steady in June and through the end of the year under Kevin Warsh's first meeting as the new chair. This week, a number of Fed officials emphasised that keeping inflation under control is still a top priority; some even hinted at the likelihood of additional rate increases if price pressures continue. According to US data, industrial production increased 0.7% month over month in April, exceeding projections of 0.3% and recovering from a 0.3% decrease in March. US markets are now anticipating housing and labour market data, along with comments from Fed officials, for next week.