Gold prices edged lower during Asian trade on Friday as a stronger U.S. dollar weighed on the precious metal, even as ongoing tensions between the United States and Iran continued to underpin safe-haven demand.
By 4:25 pm AEST (6:25 am GMT), spot gold was trading 0.5% lower at US$4,082.40 per ounce.
The U.S. dollar strengthened as investors reacted to renewed conflict in the Middle East. While mediator Pakistan maintained that negotiations between Tehran and Washington were continuing, recent U.S. strikes on Iran in response to attacks targeting American forces in Jordan heightened geopolitical uncertainty and boosted demand for the greenback.
Responding to the latest developments, Iranian Parliament Speaker Mohammad Bagher Ghalibaf said in a post on X: “Americans have grown accustomed to making up for the slaps they receive on the battlefield by spilling the blood of the innocent. They will pay the price.”
The dollar also found support from expectations that the Federal Reserve could still raise interest rates later this year, despite Fed Chair Kevin Warsh refraining from signalling a clear path for additional tightening following the central bank's policy meeting on Wednesday.
At the same time, mixed U.S. economic data, including gross domestic product (GDP) figures and weekly jobless claims, contributed to market uncertainty and helped support demand for bullion.
Despite Friday's decline, gold remained near record levels as investors continued to monitor geopolitical risks and the outlook for U.S. monetary policy.
