The newfound geopolitical calm, stemming from the ceasefire between Israel and Iran, dealt a blow to gold prices on Tuesday, sending them down over 1% to a nearly two-week low. The cessation of hostilities, after a 12-day conflict, significantly reduced the demand for safe-haven assets.
Spot gold registered a 1.4% decline, trading at $3,319.84 an ounce by 0639 GMT, its lowest level since June 11. Similarly, U.S. gold futures also experienced a downturn, slipping 1.7% to $3,335.50. This market reaction highlights gold’s role as a barometer for global stability.
Analysts, including Ilya Spivak of Tastylive, pointed to the exit of “geopolitical risk” from the market as a key driver. The ceasefire, publicly acknowledged by President Trump and Prime Minister Netanyahu, provided a clear signal of de-escalation.
The positive news extended to other markets, with global equities gaining ground and oil prices retreating to a two-week low. All eyes are now on Fed Chair Jerome Powell’s upcoming testimony, which will be closely watched for any indications regarding future interest rate policy, a crucial determinant for gold’s performance.