Gold: All eyes on Iran risks, Fed Minutes #Fetch_ai

Gold traders are weighing the latest threat by United States (US) President Donald Trump to resume attacks on Iran in “two or three days” if Tehran keeps refuting the significant concessions he wants before a deal can be struck to end the Middle East war.

Trump’s fresh warning comes after he called off a strike on Iran after the latter submitted a revised peace proposal, while also at the request of the US’ Gulf allies.#altcoins

Against this backdrop, there seems to be no end in sight to the war, and with the effective closure of the Strait of Hormuz, Oil price extends its upward trajectory, aggravating inflation concerns and sending global bond yields through the roof.

The 30-year US Treasury bond yields surged to the highest level since July 2007, near 5.20%, while the 10-year benchmark yields rose above 4.50% key level.#Write2Earn

Elevated US Treasury bond yields and inflation expectations have ramped up the odds for a Fed interest rate hike by December this year. The hawkish Fed expectations and rallying yields continue to act as a tailwind to the US Dollar (USD) at the expense of the non-yielding Gold.

The US-Iran geopolitical uncertainty also keeps the haven demand for the Greenback intact, exacerbating Gold’s pain. A stronger USD makes Gold more expensive for international buyers using foreign currencies.

That being said, Gold traders will continue to watch out for evolving developments in the US-Iran war before the release of the Fed Minutes due later in the North American session on Wednesday.

The Minutes will be dissected to gauge the central bank’s outlook on interest rates and inflation.