Gold Prices Fall as US-Iran Peace Talks Stall, Oil Prices Rise

Gold prices declined on Monday after stalled U.S.-Iran peace talks triggered a rise in oil prices, increasing concerns that inflation may remain elevated and keep global interest rates higher for a longer period.

Spot gold slipped 0.6% to $4,687.49 per ounce by 0038 GMT, while U.S. gold futures for June delivery dropped 0.7% to $4,696.60 per ounce.

The stronger U.S. dollar also weighed on bullion prices, making gold more expensive for buyers using other currencies.

Investor sentiment weakened after U.S. President Donald Trump dismissed Iran’s response to a proposed peace agreement on Sunday. The setback reduced hopes of ending the ongoing 10-week conflict that has severely impacted Iran and Lebanon.

Rising oil prices due to geopolitical tensions have intensified fears of inflationary pressure, which could discourage central banks from cutting interest rates in the near term. Higher interest rates generally reduce the appeal of non-yielding assets such as gold.

Meanwhile, market participants continue to monitor global economic developments, currency movements, and geopolitical risks for further direction in precious metal prices.