(RTTNews) – Gold prices fell toward $4,100 an ounce on Tuesday on the back of firm U.S. yields and a steady dollar.
Spot gold fell 0.9 percent to $4,127.89 an ounce while U.S. gold futures were down 0.7 percent at $4,138.74.
The dollar strengthened on safe-haven demand after reports suggested that two commercial vessels were struck by Iranian missiles while transiting the Strait of Hormuz late Monday, reigniting Middle East tensions and pushing oil and bond yields higher.
British maritime authorities said a vessel navigating off Oman’s coast in the Strait of Hormuz was struck by a projectile, renewing concerns among shipowners.
Iranian television said the liquefied natural gas tanker came under attack after ignoring warnings.
Iran’s Revolutionary Guards fired at least two missiles at commercial ships passing through the key waterway, damaging two vessels, according to Axios.
A U.S. official said both vessels suffered significant damage but no casualties. It was said the U.S. is likely to respond with strikes against Iranian targets.
Beyond geopolitical tensions, investors await the U.S. Federal Reserve’s meeting minutes and the start of the second-quarter U.S. earning season this week to gauge the outlook for consumer demand.
Dovish Fed bets are on the rise following a surprisingly weak June jobs report. Markets currently see a 25 percent chance of a 25-basis-point rate hike at the Fed’s July 29 meeting, according to CME’s FedWatch tool.
The minutes of last month’s Fed meeting under new Chair Kevin Warsh are due on Wednesday.
Fed Governor Chritopher Waller, in his assessment of inflation targeting, said that forward guidance can be a “valuable tool”, but overly rigid commitments can hinder the Fed’s ability to respond to changing data.
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