Gold Resumes Decline

Gold prices recovered to around $3,965 an ounce on Tuesday, erasing early losses and extending Monday’s 2% gain, as investors welcomed a fresh decline in oil prices ahead of the US midterm elections. Oil reversed earlier gains after President Donald Trump said the US would end its $4 billion aid programme to Israel by year-end. Meanwhile, US Energy Secretary Chris Wright said overnight strikes on Iran’s Qeshm Island had not disrupted regional oil supplies. Lower oil prices could ease inflationary pressures and reduce expectations of further central bank rate hikes. Markets currently price in nearly a 75% chance of a Fed rate hike in December, according to CME’s FedWatch Tool. Meanwhile, US midterm elections are underway, with control of the House and Senate remaining a key focus for investors. Separately, the World Gold Council lowered its forecast for gold investment growth this year to 200 metric tons from 400 tons, while raising its estimate for central bank purchases.

Gold prices fell toward $3,900 per ounce on Tuesday, surrendering gains from the previous session as oil prices rebounded following reports of a US strike on Iran’s Qeshm Island, heightening concerns over renewed inflationary pressures. Investors also turned cautious ahead of the US midterm elections, which will determine control of both chambers of Congress, with a potential Democratic takeover adding to market uncertainty. Meanwhile, renewed selling pressure in technology and artificial intelligence stocks further weighed on gold, as widespread liquidations across financial markets continued to affect precious metals. Investors also kept a close watch on developments in US-Iran negotiations for signs of diplomatic progress. An Iranian spokesperson said that "the ball is in the US court" regarding a potential agreement to end the conflict, while President Donald Trump stated in a social media post that Iran was eager to reach a settlement as soon as possible.

Gold fell toward $3,900 per ounce on Tuesday, paring gains from the previous session as investors weighed signs of diplomatic progress between the US and Iran that sent oil prices lower and eased inflation concerns. US President Donald Trump indicated progress in negotiations, while Iranian President Masoud Pezeshkian said his government had been given greater authority by the country's supreme leader to pursue peace talks. Gold has faced constant pressure this year as the conflict in the Middle East drove energy prices higher and fueled inflation, prompting central banks to raise interest rates. A global selloff in technology and AI stocks also triggered widespread liquidations, adding further pressure on precious metals markets. Meanwhile, investors are closely watching the US midterm elections, as the Trump administration and Republican Party face growing political pressure over elevated energy costs.