Global gold prices have declined in recent days despite ongoing geopolitical tensions, including the Israel-Iran conflict. This decline occurred as investors took profits after gold prices had risen sharply as a hedge. Furthermore, the absence of any major escalation in the near future has calmed the market, resulting in a temporary decline in gold demand.
Other factors weighing on gold prices are the strengthening of the US dollar and expectations that the US Central Bank (the Fed) will not immediately lower interest rates. A stronger dollar makes gold more expensive for global investors, reducing buying interest. On the other hand, relatively attractive bond yields have also prompted some funds to shift from gold to other financial assets.
However, analysts believe this decline in gold prices is short-term and more of a market correction. Geopolitical risks, global inflation, and global economic uncertainty remain factors supporting gold prices in the medium to long term. If conflicts escalate again or economic pressures increase, gold has the potential to strengthen again as a safe haven asset. (Cay)
Source: Newsmaker.id
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