Gold prices fell slightly in Asian trade on Monday amid some pressure from a strong dollar, although the yellow metal was sitting on strong gains as a worsening Israel-Iran conflict boosted haven demand.
The yellow metal saw some profit-taking on Monday after a nearly 4% jump last week, while resilience in the dollar, before a Federal Reserve meeting, also pressured metal prices across the board.
Spot gold fell 0.1% to $3,427.78 an ounce, while gold futures for August fell 0.2% to $3,446.45/oz by 00:57 ET (04:57 GMT).
Gold underpinned by Israel-Iran conflict, US intervention in focus
Gold’s stellar gains came late last week, after Israel struck several targets in Iran, including Tehran’s nuclear facilities.
The attack sparked bitter retaliation by Iran, which launched a series of missile strikes on major Israeli targets, including financial capital Tel Aviv. Some Iranian missiles were also seen breaking through Israel’s “Iron Dome” defense system.
The conflict marks a renewed escalation in tensions between the Middle Eastern countries, and spurred concerns over more regional powers getting involved.
Focus was also on any potential U.S. intervention in the conflict, after President Donald Trump said that his administration was working on hashing out a deal.
But Trump also said that Israel and Iran may have to “fight it out,” potentially signaling that a ceasefire was not close.
The missile exchange over the weekend also saw Iran cancel planned nuclear talks with the U.S., further diminishing the prospect of a deescalation.
Gold clocked strong gains as concerns over the conflict pushed traders into traditional safe havens, namely bullion.
