Gold falls as U.S. rate expectations and dollar strengthen

Gold prices experienced a volatile trading session on Tuesday, declining as shifting expectations for U.S. monetary policy and a stronger dollar outweighed ongoing geopolitical tensions in the Middle East. The precious metal traded near a multi-week low, with spot gold falling to approximately $4,540 per ounce.

The price movement followed a statement from U.S. President Donald Trump confirming he had paused a planned military strike against Iran. He stated that leaders from Gulf nations, including Saudi Arabia, Qatar, and the United Arab Emirates, had requested more time for diplomacy and expressed optimism about reaching a deal concerning Iran's nuclear program. While this development reduced immediate safe-haven demand for gold, analysts noted the underlying geopolitical standoff, particularly regarding the Strait of Hormuz, remains unresolved, leaving markets cautious.

Concurrently, financial markets grappled with persistent U.S. inflation concerns, driven in part by elevated energy prices linked to Middle East tensions. This environment has led investors to significantly recalibrate expectations for Federal Reserve policy. Market data indicates a high probability that the...