Gold retreated in Asian trade on Thursday following reports of another series of U.S. strikes on targets in Iran, a development that helped lift oil prices and provided support for the U.S. dollar.
Market participants noted that bullion continues to trade within the range that has defined price action over the past 10 days. Traders attributed the pressure on gold to the combination of a resilient dollar and firmer Treasury yields, both of which reflect investor concerns about the potential inflationary consequences of an extended U.S.-Iran conflict.
Price moves - By 21:16 ET (01:16 GMT), spot gold was down 0.4% at $4,438.92 an ounce, while gold futures fell 0.3% to $4,467.57/oz. Spot gold has been oscillating between $4,400/oz and $4,600/oz since mid-May.
Other precious metals also weakened on the session. Spot silver declined 0.9% to $73.9595/oz, and spot platinum slipped 0.7% to $1,915.88/oz.
Reports that the United States struck targets in Iran earlier on Thursday kept concerns about the region at the forefront of market minds. The accounts described the latest strikes as the second such action by the U.S. this week, further testing an already tenuous ceasefire with Iran.
At the same time, reports citing U.S. officials said the ceasefire remained in place and described the U.S. actions as "defensive" in nature. Still, the strikes lifted oil, with prices rising by as much as 2% on Thursday as the market recouped some losses experienced earlier in the week.
Separately, U.S. President Donald Trump on Wednesday largely dismissed recent reports about a framework deal to reopen the Strait of Hormuz in 30 days, and he also rejected the suggestion that Iran and Oman would control passage through Hormuz.
The waterway has remained a central focus for traders. While updated reports showed a steady trickle of oil tankers moving through the Strait of Hormuz, flows continue to be only a fraction of pre-war levels.
Beyond developments in the Gulf, attention on Thursday also centered on U.S. personal consumption expenditures (PCE) price index data for April. The PCE reading is the Federal Reserve's preferred inflation gauge and is expected to play a role in shaping expectations for interest rate policy.
Market positioning reflects concern that the inflationary effects of the Iran conflict could prompt the Fed to either keep rates steady or consider hikes later in the year. That prospect has been cited as a notable headwind for gold, an asset that tends to underperform in higher-rate environments.
Context notes - The bullion market remained range-bound amid a complex mix of geopolitical risk, stronger oil, a firmer dollar, and caution ahead of key U.S. inflation data.