Gold slips to over one-month low amid Middle East tensions
Why this matters: local context for readers following news across Pakistan and the region.
KARACHI – Gold prices slipped to their lowest level in more than a month on Monday as rising tensions in the Middle East pushed oil prices higher, increasing inflation concerns and strengthening expectations that interest rates will remain elevated for a longer period. Spot gold fell 1.1% to $4,488.99 per ounce at 0052 GMT, touching its weakest level since March 30. US gold futures for June delivery also declined 1.5% to $4,493.30. The decline came amid heightened geopolitical uncertainty, with Saudi Arabia reporting the interception of three drones. Meanwhile, US President Donald Trump warned that Iran must act “fast” after efforts to ease tensions in the US-Israel standoff appeared to stall. Oil prices continued to rise, reaching a two-week high, further adding to inflationary pressures. Higher energy costs have reinforced expectations that central banks may keep monetary policy tight for longer, reducing demand for non-yielding assets such as gold. Market participants are increasingly pricing in the possibility that the US Federal Reserve will maintain restrictive interest rates for an extended period, with traders assigning about a 50% chance of a rate adjustment by December, according to CME Group’s FedWatch tool. Investors are now awaiting the minutes of the Federal Reserve’s April meeting for further guidance on monetary policy direction. In other developments, India has restricted imports of silver in nearly all forms with immediate effect, according to an official order issued on Saturday. The move comes as the world’s largest silver consumer seeks to manage imports and ease pressure on its currency. Gold discounts in India widened to record levels last week, while demand in China remained relatively stable, supporting firm premiums. Speculative positioning also increased, with net long gold positions rising by 4,963 contracts to 100,627 in the week ending May 12. In other precious metals, spot silver declined 2.2% to $74.30 per ounce, platinum fell 0