LBMA Gold Drops 0.5% Amid U.S.-Iran Deal Watch

SEATTLE (Scrap Monster): Gold prices remained under pressure last week as easing geopolitical tensions and shifting monetary policy expectations weighed on investor sentiment.

Global equities mostly advanced during the week, while major government bond yields in the U.S., Germany, Japan, and the UK softened.However, analysts warned that even if a U.S. - Iran deal is reached, energy prices may remain volatile due to low global inventories and anticipated restocking demand.

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The LBMA Gold Price PM fell 0.5% to US$4,506 per ounce last Friday, trimming its year-to-date gain to 3.2%. The bullion prices continued to remain under pressure, mainly on account of improving investor confidence, stronger equity performance, and fading expectations for Federal Reserve rate cuts.

Furthermore, expectations for tighter monetary policy got strengthened with the appointment of Kevin Warsh as the new Federal Reserve Chair.

Gold prices continue to hold above the key 200-day moving average near US$4,377/oz, while resistance remains capped below the 55-day moving average around US$4,700/oz. According to analysts, a sustained break above US$4,700 could trigger further upside toward US$4,889, while a fall below US$4,377 may open the door for a deeper correction toward US$4,075/oz.