Gold prices edged up on Tuesday but continued to trade within a narrow range, as investors weighed the implications of a U.S. naval blockade targeting Iran while also awaiting key inflation data from the United States.
Despite the modest uptick, bullion has largely remained confined to the same band seen over the past week, with concerns over inflation tied to the Iran conflict offsetting traditional safe-haven demand for gold and other precious metals.
Spot gold rose 0.5% to $4,762.42 an ounce at 01:42 ET (05:42 GMT), while gold futures gained 0.4% to $4,784.05 per ounce. Over the last week, spot prices have mostly fluctuated between roughly $4,700 and $4,900 per ounce.
Other precious metals also posted gains, with spot silver advancing 1.4% to $76.6375 per ounce and platinum climbing 0.6% to $2,087.69 per ounce.
Weaker Dollar Offers Support as Iran Blockade Develops
Gold and broader metals were supported by a softer U.S. dollar, as markets responded to tentative signs of easing tensions in the Iran conflict following the launch of the U.S. naval blockade.
Multiple reports indicated that Washington and Tehran remain open to further talks after weekend negotiations in Pakistan failed to produce a breakthrough. Bloomberg reported that officials from both sides are considering another round of discussions before the current two-week ceasefire expires next week.
U.S. Vice President JD Vance, who led the Pakistan talks, struck a cautiously optimistic tone, saying progress had been made and that it will ultimately be up to Iran to determine whether a deal can be reached.
The dollar slipped as investor risk appetite improved on hopes for a ceasefire, although any agreement still appears distant. Risk-sensitive assets, particularly equities, recorded solid gains at the start of the week.
Markets Look to U.S. Inflation Data for Direction
Attention now turns to U.S. producer price index (PPI) data due later Tuesday, which is expected to provide further insight into inflation dynamics in the world’s largest economy.
The data will be closely watched for signs of an energy-driven increase in price pressures during March, especially after last week’s consumer price index figures showed a sharp rise in inflation.
The outbreak of the Iran conflict has significantly disrupted global energy markets, pushing oil and gas prices higher after Tehran restricted access to the key shipping corridor of the Strait of Hormuz.
The resulting surge in energy costs has fueled concerns that inflation could remain elevated, potentially prompting the Federal Reserve and other major central banks to maintain a more hawkish stance in the months ahead.
These inflation concerns have weighed on gold, pulling prices back from record highs reached in late January.
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