Gold Price Forecast: XAU/USD rebounds above $4,800, traders brace for US-Iran talks
Gold price rebounds to around $4,820 in Tuesday’s early Asian session.
The CME Group over the weekend again raised margin requirements for the two metals futures contracts.
US officials said Iran is ready to meet and negotiate a deal.
Gold price (XAU/USD) recovers some lost ground to near $4,820 during the early Asian session on Tuesday. The precious metal edges higher following a historic market rout. However, the upside in the near term might be limited, as US President Donald Trump nominated Kevin Warsh as the next Federal Reserve (Fed) chair.
The nomination of Warsh to lead the US central bank has raised expectations of a more hawkish stance. Markets anticipate that Warsh may lean toward a smaller Fed balance sheet and hold the interest rate higher for longer, which typically strengthens the US Dollar (USD) and reduces the appeal of non-yielding gold.
The Chicago Mercantile Exchange Group (CME), the world's leading and most diverse derivatives marketplace, raised margin requirements for gold and silver over the weekend. This action forced many leveraged traders to sell their positions immediately to cover costs, exerting some selling pressure on the yellow metal.
The US and Iran may hold diplomatic talks in Istanbul later on Friday as Trump weighs a possible military strike on the Islamic Republic. Traders will closely monitor the developments surrounding negotiations. Any signs of escalating tensions between the US and Iran could boost traditional safe-haven assets such as Gold in the near term.
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