Gold slips $4,000 as US-Iran tensions spark inflation fears

Gold prices declined on Monday, June 29, as renewed military exchanges between the United States and Iran in the Persian Gulf reignited inflation concerns and reinforced expectations that the Federal Reserve will maintain higher interest rates. The precious metal traded near $4,000 an ounce, extending a months-long slump driven by the geopolitical conflict and its economic fallout.

Over the weekend, Iran launched missiles and drones at U.S. military sites in Kuwait and Bahrain, actions that followed warnings from U.S. President Donald Trump. The tit-for-tat strikes, which reportedly hit a tanker carrying Qatari crude, disrupted shipping through the critical Strait of Hormuz and pushed oil prices higher. Despite the escalation, officials from both nations agreed to halt the attacks and scheduled a new round of talks set for Tuesday, June 30, in Doha, Qatar.

The conflict, which began with U.S. and Israeli strikes on Iran in late February, has driven gold down roughly 23 percent. The war-driven spike in energy prices has fueled global inflation, leading markets to anticipate that central banks will keep borrowing costs elevated for an extended period. This environment is negative...