Trump's latest threat triggers gold sell-off! Iran faces a "deadline" with the gold price plunging nearly $35 in the Asian session.

Hot Topics

Selected Stocks Data Center Market Center Capital Flows Simulated Trading

Client

Source: 24K99

On Tuesday (April 7) during Asian trading hours, due to traders weighing President Donald Trump’s latest threat — to destroy Iran’s infrastructure — and the long-term impact of war on economic growth, the spot gold price declined, continuing the downward trend from the previous two days.

(Source of screenshot: Bloomberg)

Gold prices once fell by 0.7%, breaking below $4,620 per ounce, after a cumulative decline of over 2% in the past two trading days. Trump set a deadline for Tuesday at 8 p.m. Eastern Time, demanding an agreement with Tehran, or else he would begin attacking power plants and bridges, further escalating the conflict which has already caused global fuel supply tensions and heightened inflation concerns.

The spot gold price dropped to a low of $4,616.13 per ounce, a nearly $35 intraday plunge.

This war has entered its sixth week, intensifying the likelihood that central banks will delay rate cuts or even raise interest rates. Following Trump’s latest threat, U.S. Treasury yields rose slightly on Monday, with bond traders expecting the Federal Reserve to keep rates unchanged for the rest of the year.

Since gold does not generate interest income, rising borrowing costs generally put pressure on gold prices.

Since the outbreak of Middle East conflict in late February, gold prices have fallen about 12%. Meanwhile, as investors sell assets to cover losses in other markets, the appeal of gold as a traditional safe-haven asset has also weakened.

(Source of screenshot: Bloomberg)

Overall, gold prices tend to move inversely to oil prices, which have risen for three consecutive days on Tuesday.

However, offsetting this trend is the fact that supply shocks in energy are also increasing costs, which is weighing on economic growth and providing support for gold. The U.S. services sector’s expansion slowed in March, with employment experiencing its largest decline since 2023, while input costs surged.

As gold prices decline, there are signs of some buy-the-dip funds gradually returning. Bloomberg data shows that last week, holdings in gold-backed exchange-traded funds (ETFs) increased for the first time since the outbreak of the war.

Trump reiterated at a Monday media briefing that, as part of any peace agreement, the Strait of Hormuz must reopen. This vital maritime passage connecting the Persian Gulf to global markets has been essentially closed to shipping since the conflict erupted.

Tehran has so far rejected the U.S. proposal to end the war and warned that further strikes would escalate its counterattacks in the Middle East.

Sina Cooperation Major Platform Futures Account Opening, Safe and Fast

Sina Statement: This message is reprinted from Sina cooperative media. Sina.com publishes this article to disseminate more information and does not imply endorsement of its views or verification of its descriptions. The content is for reference only and does not constitute investment advice. Investors operate at their own risk.

Massive information, precise analysis, all on Sina Finance APP

Editor: Zhu Hennan