Gold prices declined modestly in Asian markets on Friday, nearing their lowest levels in almost a month. The sustained ceasefire between Israel and Iran eased geopolitical uncertainties, reducing the metal’s appeal as a safe-haven asset. Meanwhile, market focus shifted toward upcoming U.S. inflation figures, which could impact Federal Reserve policy decisions.
Spot gold dropped about 1% to $3,293.79 per ounce, reaching levels not seen since early June. August gold futures fell 1.2%, settling near $3,306.70 per ounce early Friday (01:15 ET / 05:15 GMT). The precious metal is on track to end the week down over 2%, marking its second consecutive weekly decline and sliding nearly 6% below the record highs posted in late April.
Middle East Calm Supports Risk Appetite as Inflation Report Approaches
The ceasefire brokered by U.S. President Donald Trump between Israel and Iran remained intact through Thursday, easing concerns about escalation in the Middle East. This reduced demand for gold, which typically rises during times of geopolitical turmoil.
Attention has now turned to the release of May’s Personal Consumption Expenditures (PCE) price index—the inflation gauge favored by the Federal Reserve—expected later on Friday. Analysts forecast a 0.1% increase in both headline and core PCE for the month, translating into annual rates of approximately 2.3% and 2.6%, respectively, slightly above last year’s readings.
This follows recent remarks from Fed Chair Jerome Powell, who warned against rushing into interest rate cuts and noted that inflationary pressures, particularly from tariffs, may be more persistent than initially expected.
In response, President Trump publicly criticized Powell and mentioned considering multiple candidates to replace him, with speculation mounting around a possible new Fed chair appointment as soon as September.
Stronger Dollar Pressures Commodity Prices
During Asian trading, the U.S. Dollar Index inched up 0.1% but stayed near its lowest level in over three years. A firmer dollar makes dollar-priced commodities like gold more expensive for international buyers, often curbing demand.
Platinum futures dropped 1.3% to $1,392 per ounce, retreating from decade-high levels, though still showing a strong 32% gain for the month. Silver futures eased 0.6%, trading around $36.38 an ounce.
Copper prices showed mixed results: London Metal Exchange copper futures slipped 0.2% to $9,891.15 per ton, while U.S. copper futures ticked slightly higher, hovering near $5.06 per pound.