By: Economy Middle east

Gold prices fell on Thursday as investors looked for clearer evidence of progress in efforts to ease tensions in the Middle East, while remaining cautious of new geopolitical developments that could influence demand for safe-haven assets.

As of 5:02 GMT, spot gold was down 0.73 percent to $4,520.53, while U.S. gold futures ​for April delivery dipped 0.78 percent to $4,517.

In the UAE, gold rates edged up, 24-carat gold and 22-carat gold rising AED1.5 to AED544.5 and AED504.25, respectively.

Additionally, 21-carat gold inched up AED1.5 to AED483.5, while 18-carat gold edged up AED1.25 to AED414.5.

Meanwhile, 14-carat gold gained AED1 to AED323.25.

Gold prices fall on mixed signals

Gold prices had recovered earlier this week, rising back above $4,500 an ounce after a sharp correction, helped by a weaker dollar and cautious optimism over diplomatic efforts between the United States and Iran.

Still, the advance was limited as uncertainty surrounding the conflict continued. Iran is still considering a U.S. proposal aimed at ending the hostilities, and conflicting signals over whether talks will move forward have kept investors on edge.

On Wednesday, Iran stressed that it has no plans to enter negotiations aimed at stopping the expanding conflict, according to the country’s foreign minister.

This uncertainty has left traders uneasy, while oil prices continued to rise on Thursday. Washington has warned it could take tougher action if Iran fails to respond in a constructive manner.

Gold, which is often viewed as a safe-haven asset during periods of geopolitical stress, has displayed unusually sharp price swings in recent weeks. Earlier this month, prices dropped steeply even as tensions intensified, pressured by expectations that interest rates would stay elevated for longer and by a firmer U.S. dollar.

Inflation fears erase Fed rate cut hopes

Adding further pressure to gold prices, crude oil held above $100 a barrel on Thursday as investors reassessed the chances of de-escalation in the Middle East. Higher oil prices can stoke inflation by increasing transportation and production costs.

While inflation often supports gold’s role as a hedge, elevated interest rates tend to reduce demand for the non-yielding metal.

Markets are now no longer expecting any Federal Reserve rate cuts this year, according to CME Group’s FedWatch Tool. Before the conflict erupted, traders had been anticipating at least two cuts in 2026.

Other precious metals

As gold prices declined, the precious metals market saw downward movement. Spot silver fell 1.57 percent to $71.29, while platinum eased 0.04 percent to $1,918.90. In addition, palladium fell 0.70 percent to $1,413.50.