(RTTNews) – Gold prices have tumbled on Tuesday despite a fall in crude oil prices due to easing of Middle East tensions as economists expect the U.S. Federal Reserve to keep rates higher in the near-term.
Front Month Comex Gold for August month delivery has slumped sharply by $73.90 (or 1.69%) to $4,289.50 per troy ounce.
Front Month Comex Silver for August month delivery has nosedived by $2.438 (or 3.54%) to $66.415 per troy ounce.
In the U.S., the Small Business Optimism Index released by the National Federation of Independent Businesses today revealed a decrease in the index to 95.30 in May compared to 95.90 in April.
In its survey among small business owners, 18% cited inflation as their single most important business problem.
While a net 36.00% owners have already raised average selling prices, a net 34.00% of owners are planning to increase prices in the coming months.
The report highlighted that compared to large corporate competitors, small business owners are struggling due to the unpredictable fuel price increases.
Reflecting the third consecutive week of easing job growth, Automatic Data Processing data revealed that private employers added an average of 29,000 jobs per week in the four weeks ending May 23.
Following the solid jobs report from last Friday, investors are now betting that the U.S. Federal Reserve will hold interest rates at the current level in its upcoming meeting on June 16-17.
In a Reuters poll conducted from June 4 through June 9, nearly 70% of economists polled speculated that the key rate would stay in the current 3.50% to 3.75% range for the rest of 2026.
While many economists have pushed rate cut expectations to next year, some have dropped it altogether.
On the geopolitical front, last Wednesday, Israel and Lebanon agreed to a ceasefire, mediated by the U.S.
However, after reports of Israel carrying out strikes in southern Lebanon surfaced, Iran conducted a series of strikes on Israel on Sunday.
Houthi rebel group of Yemen joined the conflict and fired a missile at Israel’s port city of Eilat. The group announced a ban on maritime navigation of Israel in the Red Sea.
Israel retaliated attacking central and western Iran.
The scenario triggered a fresh war-threat when U.S. President Donald Trump intervened and appealed to both nations to stop attacking each other.
Later, both nations pulled back their attacks though Iran warned that in case of a fresh attack on Lebanon, Iranian strikes on Israel will renew.
Today, Trump stated that the U.S. is in the final throes of a very good deal with Iran which could be reached in a matter of two to three days.
Claiming that the deal will be strong and powerful, Trump hinted that the agreement will not allow Iran to have nuclear weapons.
Trump also assured that the Strait of Hormuz will reopen in 2-3 days of signing a pact.
Trump reiterated that the naval blockade enforced on all ships entering or exiting Iranian ports by U.S. Navy since April under his orders has been more effective than bombing to compel Iran for a deal.
WTI crude oil for July was last seen trading at $88.75, down by $2.55 (or 2.79%).
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