Gold extends pullback from two-month high as Iran risks counter receding Fed hike bets
Gold (XAU/USD) is seen extending the previous day's pullback from the vicinity of the $4,450 level, or the highest since June 5, and drifting lower for the second straight day on Friday.
Gold prices are currently undergoing a decline following a two-month high, with the commodity falling to a weekly low near $4,300. Geopolitical tensions, particularly in the Middle East, have contributed to the pullback, as Iran threatens more punitive measures against the US if military action becomes necessary. The US Federal Reserve's potential rate hikes have also weighed on the gold market, as investors seek safer assets amid uncertainty.
Iran has vowed to keep the Strait of Hormuz closed until its demands are met, while Iran-backed Houthis in Yemen continue their attacks in the Red Sea and Bab el-Mandeb Strait, heightening regional risks. Meanwhile, US inflation data shows a slowdown, which may prevent the Federal Reserve from raising interest rates promptly. Despite the pullback, gold remains supported by technical levels, including above the 200-period Exponential Moving Average and multiple Fibonacci support levels.
However, the broader uptrend remains under pressure, as momentum indicators suggest fading upside potential.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — it may contain errors, so check the original before relying on it.
Also reported by 1 other outlet
- China yuan nears 3-1/2-year high as Fed rate hike bets fade thehindubusinessline.com
