Gold prices moved higher during Asian trading on Tuesday, drawing some renewed buying interest after suffering steep declines throughout March as rising inflation expectations tied to the U.S.–Israel conflict with Iran pressured non-yielding assets such as precious metals.
Metals markets were also supported by reports that U.S. President Donald Trump is considering scaling back military operations against Iran, as the conflict appears likely to stretch beyond the four-to-six-week timeframe initially anticipated.
Additional support came after Federal Reserve Chair Jerome Powell said long-term inflation expectations remain well anchored despite potential short-term disruptions.
Spot gold rose 1% to $5,556.54 per ounce at 01:17 ET (05:17 GMT), while gold futures gained 0.6% to $4,587.01 per ounce.
Other precious metals also strengthened on Tuesday. Spot silver climbed 2.7% to $71.9805 per ounce, while spot platinum increased 0.8% to $1,914.85 per ounce, although both metals remain on track to record sizable losses for the month of March.
Trump may end Iran campaign without reopening Hormuz – WSJ
According to a report by the Wall Street Journal on Monday evening, Trump told advisers he could be willing to conclude the military campaign against Iran even if the Strait of Hormuz remains closed.
Officials cited in the report believe that an operation to fully reopen the strait would likely extend the conflict beyond the president’s initial timeline and could require a complicated military effort.
Instead, Trump is said to believe the U.S. could begin winding down hostilities after achieving core objectives, including weakening Iran’s naval strength and degrading its missile capabilities.
Washington would then attempt to pressure Tehran through diplomatic channels to reopen the strait, while also encouraging European and Gulf allies to take the lead in restoring maritime access.
The report raised some optimism that the conflict might eventually ease, although a continued closure of the Strait of Hormuz — which carries roughly 20% of global oil supply — would likely keep energy prices and inflation concerns elevated.
Gold heading for worst month in nearly two decades
Despite Tuesday’s modest rebound, gold prices remain on course for their weakest monthly performance in almost 20 years.
Spot gold was down about 14% in March, which would also end a seven-month streak of gains for the precious metal.
The metal has come under pressure as investors reassess expectations for further interest rate cuts from the Federal Reserve. The surge in oil prices following the outbreak of the Iran conflict has boosted inflation expectations, dampening hopes for monetary easing.
At the same time, several major central banks — including the European Central Bank and the Bank of Japan — have indicated that interest rate hikes could be considered to counter energy-driven inflation, pushing bond yields higher and reducing the appeal of non-yielding assets like gold.
These pressures have also weighed on other precious metals. Spot silver has fallen roughly 23% this month, while platinum is on track to drop about 19% in March.
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