Potential easing of geopolitical tensions in Eastern Europe weighs on gold prices — Reuters

A slight strengthening of the dollar after its yesterday's drop triggered by Moody's downgrade of the US credit rating along with expectations of reduced geopolitical tensions in Eastern Europe have pushed gold prices lower. Both factors are dampening investor demand for the safe-haven asset, Reuters reports.

Capital.com analyst Kyle Rodda noted that buyers in the gold market tend to become more active when the price falls below $3,200 per ounce. However, he predicts a more significant pullback if geopolitical tensions are defused and trade relations between major economies improve.

Gold has gained 22% since the beginning of 2025 driven by various global shocks, including new US President Donald Trump's tariff policies, Reuters adds. Meanwhile, the Federal Reserve (Fed) continues to maintain a wait-and-see approach, analyzing incoming US economic data. The central bank's shift to lower interest rates may support gold prices. Thus, investors are closely watching the development of the situation in the gold market, the news agency says.