Gold Prices Surge Amid US-Iran Tensions and Fed Policy Uncertainty

Gold prices rose on Thursday, continuing an upward trajectory initiated by persistent geopolitical tensions between the U.S. and Iran. This uncertainty has spiked safe-haven demand among investors. Spot gold increased by 0.5% to $5,004.47 per ounce, while U.S. gold futures for April saw a 0.3% rise to $5,025.10.

Kyle Rodda, a senior market analyst at Capital.com, emphasized that Middle East conflicts fundamentally support gold prices by boosting safe-haven demand. The latest talks with Iran in Geneva saw limited progress, with unresolved issues, prompting warnings from Russian Foreign Minister Sergei Lavrov about severe consequences of additional U.S. strikes.

On the monetary front, the Federal Reserve's January minutes reveal a near-unanimous stance on holding current interest rates. However, views are divided on future actions depending on inflation trends. Markets anticipate an interest rate cut in June. Investors are now focussed on upcoming economic reports, including jobless claims and the Fed's preferred inflation measure, the Personal Consumption Expenditures report.