Ceasefire Shocker! Trump’s Israel-Iran Deal Sends Gold Prices Tumbling

Gold prices dipped to a near two-week low on Tuesday after U.S. President Donald Trump declared a surprise ceasefire between Israel and Iran, relaxing geopolitical tensions and blunting demand for safe-haven assets. Spot gold lost 0.5% to $3,351.47/oz, its lowest since June 11, while U.S. gold futures declined 0.9% to $3,365.30.

Global Markets Rally, Oil Slumps

The news provoked a widespread global stock market rally and put crude oil prices at a one-week trough, showing better risk sentiment. "There's a good bit of geopolitical risk leaving the market near term," said Ilya Spivak, a global macro head at TastyLive.

Iran Confirms Truce, Israel Silent

The 12-day war between Israel and Iran, displacing millions in Tehran and fueling fears of escalation in the region, is cooling possibly. Although an Iranian official has confirmed the ceasefire, Israel's official response is still pending. Iran's foreign minister warned that fighting would resume if Israeli attacks continue.

Attention Turns to Fed Chair Powell

As geopolitical tensions subside, focus shifts to U.S. monetary policy. Fed Vice Chairman Michelle Bowman stated that the era of rate reductions is nearing, referencing threats to the labor market. Markets are holding out for Jerome Powell's testimony to the House Financial Services Committee later today. His remarks will drive near-term direction for gold and the dollar.

Outlook: Transitory Correction Before Gold Recovers?

Analysts maintain that gold's long-term tendency is still bullish, but short-term correction is possible in the present scenario. "If Powell makes markets believe that aggressive rate cuts are not on the horizon, the dollar may strengthen in the short term, pushing gold," Spivak added.

Other Precious Metals Also Ease

Silver fell 0.1% to $36.10/oz

Platinum fell 0.2% to $1,292.39/oz

Palladium fell 0.4% to $1,073.05/oz

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