Gold prices declined during Asian trading on Thursday as markets assessed conflicting developments surrounding the Iran conflict, while a stronger U.S. dollar reduced the appeal of bullion.
By 03:00 ET (07:00 GMT), spot gold had fallen 1.1% to $4,457.06 an ounce. U.S. gold futures dropped 2.2% to $4,485.10.
The precious metal had recovered earlier in the week, briefly moving back above the $4,500-per-ounce level after a sharp pullback. The rebound was supported by a softer dollar and cautious optimism about diplomatic efforts between the United States and Iran.
Iran considers U.S. peace proposal
However, further gains were limited as uncertainty around the conflict continued. Iran is currently reviewing a U.S. proposal intended to bring the fighting to an end, with mixed indications about whether talks could move forward.
Although Tehran has not formally endorsed the plan, it has also avoided rejecting it outright, fueling cautious expectations that a path toward de-escalation might still emerge.
At the same time, Iran has publicly denied that it is engaged in direct negotiations with Washington and has emphasized that major disagreements remain. The lack of clarity has kept traders wary, with oil prices moving higher again on Thursday.
Officials in Washington have warned that stronger actions could follow if Iran fails to participate constructively.
Gold weighed down by rate concerns and stronger dollar
Gold, which is typically viewed as a safe-haven asset during periods of geopolitical tension, has behaved unusually in recent weeks. Earlier this month, prices dropped sharply despite escalating tensions, largely because markets began to expect interest rates to remain higher for longer and the U.S. dollar strengthened.
Oil price movements have also influenced market sentiment. A sharp rise in crude prices has increased concerns about inflation, potentially forcing central banks to keep borrowing costs elevated. That environment tends to pressure non-yielding assets such as gold.
The U.S. Dollar Index was broadly stable on Thursday after two consecutive sessions of gains.
Among other precious metals, silver declined 1.8% to $69.97 per ounce, while platinum fell 1.8% to $1,897.60 per ounce.
Benchmark copper futures on the London Metal Exchange slipped 1.3% to $12,177.0 per ton, while U.S. copper futures edged down 0.5% to $5.49 per pound.