Gold falls on firm dollar, fading Fed rate-cut hopes

Gold prices fell more than 1% on Monday, pressured by a stronger dollar and fading hopes of U.S. Federal Reserve interest rate cuts.

FUNDAMENTALS

* Spot gold fell 1.2% to $4,620.68 per ounce by 0047 GMT. U.S. gold futures for April delivery lost 0.7% to $4,647.10. * The 10-year U.S. Treasury yield and the dollar index rose, pressuring greenback-priced bullion.


* U.S. President ‌Donald Trump ⁠threatened to ⁠rain "hell" on Tehran if it did not reopen the Strait of Hormuz by Tuesday, a critical route for global oil shipments.

* However, recent U.S. intelligence assessments suggest Iran is unlikely to reopen the strait any time soon, per three sources familiar with the matter. * Oil prices opened higher on Monday and held above $110 per barrel, as the U.S.-Israeli war with Iran continued to disrupt global energysupplies.

* ⁠The surge ‌in crude prices have heightened concerns about rising inflation. While gold is traditionally seen as a hedge against inflation, elevated interest rates tend ⁠to dampen demand for the non-yielding asset.

* Chicago Federal Reserve President Austan Goolsbee said on Thursday it was "unfortunate timing" for the economy to be hit by an oil shock that is pushing up prices before inflation from last year's tariff shocks has had a chance to subside, a development he said was concerning.

* Meanwhile, data showed that nonfarm payrolls increased by 178,000 jobs in March, the most since December 2024, while ‌the unemployment rate fell to 4.3%.

* Traders have almost completely priced out any chances of a Fed rate cut this year. Before the Iran war began, there ⁠were expectations of two reductionsthis year.

* COMEX gold speculators increased net long positions by 1,098 contracts to 93,872 in week to March 31.

* Gold traded at a premium in India last week for the first time in two months, as softer prices boosted demand for the metal, while premiums in China ticked down slightly as buyers awaited a deeper correction.

* Spot silver fell 1% to $72.28 per ounce, spot platinum shed 0.5% to $1,979.42, while palladium edged 0.1% higher at $1,504.34.

DATA/EVENTS (GMT)

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