Overview
- Spot gold climbed just over 1% to above $4,100 on Thursday after renewed U.S. strikes on Iran and Iranian responses that included reported strikes on positions in Kuwait and Bahrain, prompting investors to move into safe assets.
- Federal Reserve minutes from June showed policymakers split on the need for further rate hikes, a division that reopened the possibility of tighter policy and helped support short-term gold demand.
- Rising oil and energy prices tied to the Gulf hostilities have intensified inflation worries, which can lift demand for gold as an inflation hedge but also make the Fed more likely to keep rates higher, limiting bullion's upside.
- A still-strong U.S. dollar and higher real interest rates have been key reasons for gold's multi-month correction toward the $4,000 area, creating technical pressure even as episodic safe-haven flows produce rebounds.
- Analysts at Credit Agricole and others point to large, price-insensitive central-bank purchases and a trend toward de-dollarisation as structural supports that could underpin a more sustained recovery if energy shocks fade.