Gold Prices Rise as Geopolitical Tensions in the Middle East Ease
Gold prices rose significantly during trading on Wednesday, at the start of April, surpassing the $4,700 mark to reach approximately $4,747 per ounce.
This rise comes amid signs of easing tensions in the Middle East, which could lead to lower oil prices and alleviate pressures associated with global monetary tightening.
Easing Geopolitical Risks Limit Gold’s Gains
Despite the rise in gold prices, gains remained relatively limited, as the easing of geopolitical tensions led to lower demand for safe-haven assets, particularly the precious metal.
Gold typically benefits from escalating crises but faces pressure when signs of de-escalation emerge.
Reports indicated that Donald Trump informed his advisors of his willingness to end the war with Iran, even if the Strait of Hormuz remains partially closed.
Conversely, there were indications from the Iranian side that Masoud Pezshkian might consider ending the conflict under specific conditions.
Weak Performance for Gold in March
In terms of monthly performance, gold recorded a sharp decline in March, losing more than 13% of its value the largest monthly drop since the 2008 global financial crisis.
Gold remains far from the record highs it reached last January, reflecting the continued uncertainty in the markets.
Anticipation of U.S. Economic Data
Investors are currently focusing on upcoming U.S. economic data, along with signals from the Federal Reserve, in search of clues about the future of interest rates.
The path of monetary policy is one of the key factors influencing gold’s movements, given the inverse relationship between interest rates and the value of gold.
War inventions cost it energy
Following a 32-day military campaign, Trump stated that U.S. troops would withdraw from Iran within two to three weeks, confirming that the goal of neutralizing the Iranian nuclear threat had been achieved.
He also noted that the United States does not need a formal agreement to withdraw, adding that rebuilding the destroyed infrastructure could take many years.
Regarding energy markets, Trump noted that gasoline prices had exceeded $4 per gallon, predicting they would drop once the conflict ended.
He also emphasized that the responsibility for securing navigation in the Strait of Hormuz lies with the countries that benefit from it, not the United States.
