A wave of renewed confidence swept through global markets on Tuesday, causing gold prices to drop more than 1%. This shift was directly attributed to the implementation of a ceasefire between Israel and Iran, effectively ending their recent 12-day conflict and easing regional tensions. As risk appetite returned, the demand for safe-haven assets like gold naturally receded.
Spot gold fell 1.4% to $3,319.84 an ounce, reaching its lowest point in almost two weeks. U.S. gold futures also experienced a notable decline, slipping 1.7% to $3,335.50. This downturn illustrates gold’s sensitivity to geopolitical stability and investor confidence.
The de-escalation of tensions was confirmed by U.S. President Donald Trump and Israeli Prime Minister Benjamin Netanyahu, both of whom announced the ceasefire and urged compliance. This positive development significantly reduced the perceived geopolitical risk in the market.
Beyond gold, the ceasefire news fueled a rally in global equities, while oil prices retreated to a two-week low as concerns over supply disruptions diminished. Investors are now turning their attention to Fed Chair Jerome Powell’s testimony, which could offer insights into future monetary policy, a crucial factor influencing gold’s performance.
Risk On: Gold Drops as Mideast Ceasefire Boosts Confidence
