Gold Holds Steady As Oil Dips On US-Iran Peace Hopes

(RTTNews) - Gold was little changed on Monday, reversing early losses as the dollar eased and risk currencies rebounded on signs of renewed diplomatic efforts between the United States and Iran.

Spot gold was marginally higher at $4,020.14 an ounce after recording its second consecutive weekly decline amid expectations that U.S. interest rates will remain elevated. U.S. gold futures were up 0.1 percent at $4,024.12.

Brent crude futures slipped slightly to around $88 a barrel in volatile trade, after having risen over 2 percent toward $91 a barrel earlier in the session as the United States carried out strikes against Iran for the ninth day in a row and Iran retaliated against U.S. assets across the Middle East, posing threats to shipping in the Strait of Hormuz.

The price drop came after Tehran vowed to pursue diplomatic efforts alongside military response and safeguard security in the Strait of Hormuz, helping ease some supply concerns.

"We will not discuss their details at this stage. While our armed forces respond firmly and decisively to the source of American aggression, diplomacy is fully aware of its duties and spares no effort in fulfilling them", Foreign Ministry spokesman Esmaeil Baqaei was quoted as saying during a press briefing.

This week's U.S. economic calendar is relatively subdued, with investors awaiting preliminary PMI surveys for the manufacturing and services sector, June's leading economic indicators, and new home sales data for June for more insights into the economic and rate outlook ahead of the Federal Reserve's next monetary policy meeting due on July 29.

Federal Reserve Bank of Cleveland President Beth Hammack said on Friday that persistently high inflation is her bigger concern, joining other hawks arguing interest rates may need to rise. Currently, futures imply a 60 percent chance of a rate hike as early as September.