Gold prices fell during trading on Wednesday, June 3, as tensions in the Middle East escalated amid renewed fighting.
In trading, gold futures fell by about 0.7% to $4,487.2 per ounce, while the spot price of the yellow metal also declined by 0.4% to $4,463.42 per ounce.
The US military announced that Iran launched ballistic missiles towards Kuwait and Bahrain, but they failed to hit their targets, adding that its forces launched raids on the Iranian island of Qeshm in response to the attack attempts.
These developments have reinforced concerns that interest rates will remain high for a longer period in order to curb inflation.
US Secretary of State Marco Rubio said yesterday that President Donald Trump's negotiating team did not offer Iran sanctions relief in exchange for reopening the Strait of Hormuz, and insisted that this was linked to Tehran abandoning its nuclear program.
Oil prices rose by more than 1% in early trading today, increasing concerns about inflation and a potential interest rate hike.
Cleveland Federal Reserve President Beth Hammack said yesterday that the U.S. central bank may have to raise interest rates soon if already high inflation pressures continue to mount.
Investors are now awaiting the U.S. non-farm payrolls data due later today and Friday's employment report to assess the Federal Reserve's monetary policy path.
Separately, Swiss customs data released yesterday showed that gold exports from Switzerland fell 20% in April compared to the previous month, as shipments to Britain and China slowed, offsetting higher shipments to India and Hong Kong.
