XAU/USD retreats from a two-week peak as the USD strengthens amid heightened Strait of Hormuz risks and Fed rate cut expectations ease.
Gold (XAU/USD) retreated below $4,200 after briefly touching a two-week high, pressured by a stronger US Dollar (USD) driven by geopolitical risks in the Strait of Hormuz. Iran’s plan to impose new fees on ships passing through the waterway has kept tensions elevated, supporting safe-haven demand for the USD.
The metal’s gains were also capped by reduced expectations of US Federal Reserve rate hikes following weaker-than-expected US employment data. However, persistent central bank buying continues to provide underlying support for gold, offsetting some of the downward pressure.
Market focus remains on geopolitical developments and Fed policy signals, with traders balancing risk sentiment against monetary policy expectations.