Home
Gold prices recover from two-week low as markets watch global tensions

Gold prices recover from two-week low as markets watch global tensions

Web Desk
Jun 25, 2025

SINFAPORE: Gold prices rose slightly on Wednesday, supported by a weaker US dollar and subdued Treasury yields, as investors kept a close watch on the uneasy ceasefire between Israel and Iran.

By 0250 GMT, spot gold had gained 0.2 per cent to trade at $3,328.89 an ounce, recovering some ground after touching a two-week low in the previous session. US gold futures were also up by 0.3 per cent, reaching $3,343.00.

The US dollar index hovered near a one-week low, boosting demand for gold by making it cheaper for holders of other currencies. Meanwhile, yields on 10-year Treasury bonds remained close to their lowest levels in over a month.

Kelvin Wong, senior market analyst at OANDA, said the retreat in the dollar and Treasury yields had supported gold. He noted that a further decline in the dollar, along with renewed concerns over the US fiscal deficit and tariff policy, could drive gold prices higher—especially as tensions between Israel and Iran ease.

Earlier, both Iran and Israel indicated a halt in hostilities, at least for the time being, following public criticism by US President Donald Trump over their breach of a ceasefire agreement he had announced.

Meanwhile, concerns about the US economy also influenced market sentiment. Consumer confidence fell unexpectedly in June as Americans became more pessimistic about job prospects, adding to signs that the labour market may be weakening under pressure from ongoing trade tensions.

Federal Reserve Chair Jerome Powell told lawmakers on Tuesday that increased tariffs could lead to higher inflation during the summer. This period is expected to play a key role in shaping the Fed’s decision on whether to cut interest rates.

Traders are now pricing in 60 basis points of rate cuts by the Fed in 2025, with the first cut likely in September.

In a separate development, a report by the Official Monetary and Financial Institutions Forum revealed that one in three central banks managing a total of $5 trillion intend to increase their gold holdings in the next one to two years—the highest proportion in at least five years.

In other precious metals, spot silver held steady at $35.90 an ounce. Platinum slipped 0.3 per cent to $1,312.56, while palladium dropped 0.5 per cent to $1,060.50.