Gold drifts lower with focus on Israel-Iran conflict, Fed meeting
Shafaq News/ Gold prices slipped on Monday after hitting nearly an eight-week high, while the market focused on escalating Israel-Iran tensions and the Federal Reserve's policy meeting this week.
Spot gold was down 0.5% to $3,416.48 an ounce by 8:57 a.m. EDT (1257 GMT) after hitting its highest level since April 22 earlier in the session. Prices rose more than 1% on Friday.
US gold futures were down 0.5% to $3,436.10.
"Keep in mind that gold has moved higher over the past several sessions, largely in response to the conflict between Israel and Iran. Today, we're seeing more of a pullback, likely due to profit-taking after that higher move," said David Meger, director of metals trading at High Ridge Futures.
Iranian missiles struck Tel Aviv and the port city of Haifa on Monday, prompting Israel's defence minister to warn that residents in Tehran would "pay the price and soon".
Meanwhile, leaders from the Group of Seven nations begin annual talks in Canada.
US stock index futures rose while the dollar held ground in choppy trading.
Investors are also focused on the Fed's two-day policy meeting, which wraps up on Wednesday. The US central bank is widely expected to keep interest rates unchanged.
"At this point, it appears the Fed is inclined to remain on hold, given the significant uncertainty in the economy, ranging from tariffs to geopolitical tensions. So, it wouldn't be surprising to see the Fed delay any interest rate cuts, effectively kicking the can down the road," Meger said.
Bullion is viewed as a safeguard during times of geopolitical instability and rising inflation. It also benefits from low interest rate environments, since it doesn't offer any yield income.
Among other metals, spot silver rose 0.4% to $36.45 per ounce, platinum jumped 2.6% to $1,259.80, while palladium gained 2.3% to $1,051.07.
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