Gold prices edged lower in early Asian trading on Monday as investor demand for safe-haven assets shifted toward the U.S. dollar following American military strikes on Iranian nuclear facilities. The escalation in geopolitical tensions appeared to reinforce confidence in the greenback, dampening gold’s recent rally.
Spot gold dipped 0.2% to $3,360.11 per ounce, while gold futures slipped 0.3% to $3,374.72 by 01:08 ET (05:08 GMT). Despite Monday’s dip, the precious metal remains elevated compared to earlier in the month, supported by heightened geopolitical uncertainty stemming from the Israel-Iran conflict.
Dollar Strength Weighs on Precious Metals
The primary driver behind gold’s decline was a stronger dollar, which rose over 0.3% against a basket of major currencies. The greenback’s appeal was bolstered by fears of further instability in the Middle East and expectations that inflationary pressures may keep U.S. interest rates elevated.
Over the weekend, U.S. forces targeted three of Iran’s nuclear sites, prompting President Donald Trump to claim the facilities were effectively neutralized. The strikes were reportedly motivated by concerns over Iran’s alleged pursuit of nuclear weapons—allegations Tehran continues to deny.
The attack marked a significant escalation in regional tensions, with Iran warning of retaliatory measures, including the potential blockade of the Strait of Hormuz—a vital maritime route for global oil shipments. Fears of such retaliation pushed oil prices higher, reinforcing inflation concerns and supporting the dollar.
Market Awaits Fed Commentary
Investors now turn their attention to upcoming comments from Federal Reserve officials, particularly Chair Jerome Powell, who is scheduled to deliver testimony before Congress starting Tuesday. The Fed’s recent ambiguous tone on rate cuts has already helped lift the dollar in recent sessions.
Platinum and Silver Pull Back from Highs
Other precious and industrial metals also saw minor corrections. Platinum futures eased 0.1% to $1,263.15 per ounce after reaching a four-year high last week. Silver futures gained a modest 0.1% to $36.05 per ounce, staying near their highest levels in over 13 years.
Among base metals, copper prices weakened slightly. London Metal Exchange copper contracts declined 0.1% to $9,643.15 per ton, while U.S. copper futures slipped 0.3% to $4.820 per pound.
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