Gold Prices Steady Amid U.S.-Iran Talks, Weaker Treasury Yields

Alanbatnews -

Gold prices held steady during mid-Asian session trading, supported by a decline in U.S. Treasury yields, which reduced the opportunity cost of holding the precious metal. However, receding safe-haven demand limited gains as investors closely monitor developments in U.S.-Iran negotiations.

Kelvin Wong, a senior market analyst at OANDA, noted that the drop in real yields on 10-year U.S. bonds, after accounting for inflation, has been a supportive factor for prices. He explained that this decline has allowed gold to maintain its stability despite the reduction in risk premiums following U.S.-Iran talks.

Spot gold rose 0.1% to $5,192.19 per ounce. The benchmark U.S. 10-year Treasury yield retreated to its lowest level in three months, boosting the appeal of non-yielding bullion.

U.S. gold futures for April delivery also saw an increase, rising 0.3% to $5,209.20 per ounce.

According to a Qatari mediator, the United States and Iran have made progress in talks held in Geneva regarding Iran's nuclear program. However, negotiation rounds concluded without a decisive breakthrough that would dispel the possibility of U.S. strikes, amid a large-scale military build-up.

The dollar is on track for monthly gains of nearly 0.6%, supported by signals of a more hawkish stance from the Federal Reserve, which increases the cost of dollar-denominated gold for holders of other currencies.

Expectations that Federal Reserve candidate Kevin Warsh would cut interest rates immediately upon taking office, in line with President Donald Trump's expectations, have declined amid growing optimism about the strength of the U.S. economy.

Recent data showed a slight increase in new jobless claims in the United States last week, while the unemployment rate appeared stable, reflecting the continued strength of the labor market.

Markets are currently pricing in at least three interest rate cuts of 25 basis points each this year, according to the CME Group's FedWatch Tool.

Turning to other precious metals, spot silver rose 1.6% to $89.73 per ounce, on track for monthly gains of around 6.1%. Platinum climbed 5.2% to $2,260.09, its highest level in four weeks, while palladium increased 2.3% to $1,825.29 per ounce.

Gold is heading for its seventh consecutive monthly gain, rising more than 6% during the month, driven by renewed uncertainty over U.S. tariffs and geopolitical tensions between Washington and Tehran, reinforcing its status as a traditional hedge in times of turmoil.