Gold Prices Lose Shine After Israel-Iran Ceasefire Blocks Safe-Haven Flows

Gold prices slipped on Thursday after a fall in safe-haven demand as U.S. President Donald Trump said that Israel and Iran have agreed to a ceasefire.

Trump’s post on Truth Social sparked a rise in global equity markets, as investors opted to park their money in riskier assets. Israeli Prime Minister Benjamin Netanyahu stated that Israel has agreed to Trump's ceasefire proposal.

Spot gold prices fell 1.1% to $3.331.6 per ounce at 8.15 am GMT, while U.S. gold futures slipped 1.6% to $3.341.7 per ounce.

"It seems like there's a good bit of geopolitical risk that's exiting the market here near term after, of course, we have signs of de-escalation between the U.S. and Iran," Ilya Spivak, head of global macro at Tastylive, said, according to Reuters.

Silver prices, which have also rallied alongside gold, were roughly flat on Tuesday. SPDR Gold Shares ETF (GLD) slipped close to 1% in premarket trading.

Investors will now be keen to listen to Federal Reserve Chair Jerome Powell’s testimony at the House Financial Services Committee later on Tuesday. Powell has been publicly criticized by Trump several times over his cautious approach to interest rate decisions.

Trump again urged the Federal Reserve to cut interest rates by two to three percentage points before saying that it could save the U.S. hundreds of billions of dollars.

According to CME Group’s FedWatch tool, over 77% of investors expect the U.S. central bank to maintain interest rates within the current 4.25% to 4.5% range, while 22% expect a 25-basis-point rate cut. The monetary committee is scheduled to meet on July 30.

Any rate cut could drive gold prices higher as investors use the commodity to hedge against inflation.

Retail sentiment about SPDR Gold Shares ETF was in the ‘bearish’ territory while retail chatter was ‘normal.’

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