By Noel John
Bengaluru — Gold prices fell more than 1% on Tuesday, extending their slide to a tenth straight session, pressured by a firm dollar and fading hopes for near-term Federal Reserve interest rate cuts.
Spot gold declined 1.5% to $4,340.63/oz by 4.18am GMT, losing about 22% in 10 sessions.
In the previous session, the metal fell to $4,097.99/oz, its lowest level since November 24, before paring some losses.
US gold futures for April delivery slipped 1.5% to $4,340.90.
The dollar strengthened on Tuesday, making greenback-priced bullion more expensive for holders of other currencies.
Markets are pricing in interest rate hikes, “reasoning that the war in Iran will drive inflation. That global central banks will turn more hawkish as a result has been pushing gold lower,” said Ilya Spivak, head of global macro at Tastylive.
For gold, the immediate support levels are at $4,275 and $4,000, while the resistance is seen at $4,650 and $4,840, said Spivak.
Spot gold prices have fallen about 18% since the US-Israeli war on Iran started on February 28, with the dollar emerging as one of the clearest safe-haven winners.
On Monday, Iran denied any negotiations with the US after President Donald Trump postponed a threat to bomb Iran’s power grid, citing what he described as productive talks with unnamed Iranian officials.
A Pakistani official and a second source told Reuters that direct talks to end the conflict could take place in Islamabad as early as this week.
Oil prices held above $100 a barrel after Tehran denied it had discussed ending the Middle East war with Washington.
Higher crude prices tend to fuel inflation by pushing up transport and manufacturing costs. Although rising inflation typically boosts gold’s appeal as a hedge, high interest rates weigh on demand for the non-yielding asset.
Meanwhile, investors trimmed bets on a December Fed rate hike to roughly 13%, from just above 25% in the previous session, according to CME Group’s FedWatch.
Spot silver lost 3.4% to $66.80/oz. Spot platinum fell 2.1% to $1,841.68 and palladium shed 2.7% to $1,395.25.
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