Gold prices steady

Gold prices steadied on Tuesday after ​falling nearly 2 percent earlier in the session, as investors weighed conflicting signals on ‌a potential de-escalation in the US-Israeli war on Iran, and its impact on the outlook for inflation and interest rates.

Spot gold was up 0.1 percent at $4,411.28 per ounce as of 1104 GMT, after falling to $4,097.99 per ​ounce in the previous session, its lowest since November 24.

US gold futures for April ​delivery added 0.1 percent to $4,412.70.

SOME STABILITY FOR NOW

“The market is in a wait-and-see position. Considering that oil prices are a bit lower, this is reducing these rate hike ​expectations somehow and that’s giving some stability to the gold price now,” said UBS analyst ​Giovanni Staunovo.

International Brent crude prices plunged 13 percent on Monday after Trump ordered a five-day delay to attacks on Iran’s power plants, but traded moderately higher on Tuesday as Iran denied it had talks with the ​United States to end the war in the Gulf.

The rise in energy prices caused by ​the war has increased inflation concerns and made higher interest rates globally more likely. While gold is ‌considered an inflation hedge, high interest rates reduce the non-yielding asset’s appeal, and the metal has fallen around 18 percent since the war began.

Iran launched waves of missiles at Israel on Tuesday, the Israeli military said.

San Francisco Federal Reserve Bank President Mary Daly said on Monday that unless the Iran ​conflict is resolved quickly ​and the Fed can “look through” a temporary increase in oil prices, it is unclear what the central bank’s next move on interest rates will need to ​be.

However, analysts say there are broader factors that should still support gold ​prices this year.

“Structural drivers for the gold rally over the recent years, debt issues, political pressure on the Fed to cut rates, high inflation, low interest rates, and a weaker dollar, these factors are still ​there. Nothing has changed on that side,” Staunovo added.

Elsewhere, spot silver rose 0.9 percent to $69.77 per ounce. Spot platinum added 1.3 percent to $1,906.80 and palladium lost 1 percent to $1,419.25.