Gold ticks up as markets digest US-Iran updates, await inflation data
Gold | 2026-05-12 04:56:38
Gold tends to come under pressure despite its safe-haven appeal, as higher rates increase the opportunity cost of holding non-yielding assets.
By Paul Ploumis
SEATTLE (Scrap Monster): Gold prices reversed course to edge up on Monday in volatile trading, as investors assessed developments in U.S.-Iran diplomacy and awaited key U.S. inflation data due later this week.
Spot gold was up 0.2% at $4,723.40 per ounce, by 2:02 a.m. EDT (1802 GMT) after falling over 1% earlier in the session.
U.S. gold futures settled little changed at $4,728.70.
"There is just some bargain hunting coming in and positioning ahead of the U.S. inflation data this week," said Jim Wyckoff, market analyst at American Gold Exchange.
Focus will be on the U.S. Consumer Price Index (CPI) due on Tuesday and the Producer Price Index (PPI) scheduled for release on Wednesday.
On the geopolitical front, President Donald Trump's swift rejection of Iran's response to a U.S. peace proposal has fuelled concerns that the 10-week-old conflict will drag on and continue to paralyse shipping through the Strait of Hormuz, pushing oil prices higher.
"The setback keeps the ceasefire timeline uncertain and inflation risks elevated – reinforcing the higher-for-longer rate narrative that has weighed on gold throughout the conflict," ING analysts said in a note.
They added that they see prices rising to $5,000/oz by year-end, but the stalling of peace talks adds near-term uncertainty.
Global brokerages have scaled back expectations of two U.S. interest rate cuts this year, with forecasts now split between some easing and no cuts at all in 2026.
Gold tends to come under pressure despite its safe-haven appeal, as higher rates increase the opportunity cost of holding non-yielding assets.
Markets are also watching Trump’s two-day visit to China this week, where he is set to meet Chinese President Xi Jinping to discuss Iran, Taiwan, artificial intelligence and nuclear weapons.
Elsewhere, shares of Indian jewellery retailers tumbled after Prime Minister Narendra Modi urged people to refrain from buying gold for a year to protect foreign exchange reserves. India is the second-largest gold consumer.
Among other metals, spot silver was up 6.6% at $85.65 per ounce, platinum gained 3% to $2,116.72, and palladium added 0.8% at $1,503.11.
Courtesy: www.reuters.com
