XAU/USD hovers at March lows as traders weigh Middle East truce against persistent inflation fears and Fed rate expectations.
Gold (XAU/USD) trades in a tight range near $4,267-$4,268 during Tuesday’s Asian session, failing to extend a late rebound from Monday. A pullback in the US Dollar (USD) after Iran and Israel halted attacks provided temporary support, but gains remain limited.
The metal hit its lowest level since March 23 amid mixed signals. While diplomatic progress eased immediate tensions, major disputes over Iran’s nuclear program and maritime control persist, sustaining geopolitical risk premiums. Meanwhile, constrained shipping through the Strait of Hormuz keeps energy markets volatile, fueling inflation concerns.
Traders are also monitoring expectations for a hawkish Federal Reserve, which could further pressure gold. The combination of lingering geopolitical risks and tighter monetary policy leaves the precious metal in a narrow band.