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Gold price falls to around $5,085 in Friday’s early Asian session.
Conflicts in the Middle East have pushed up oil and gas prices, stoking fears of renewed inflation.
Iran intensifies attacks across the Gulf, which might help limit the Gold’s losses.
Gold price (XAU/USD) tumbles to near $5,085 during the early Asian session on Friday. The precious metal loses ground amid a stronger US Dollar (USD). The US employment report for February will take center stage later on Friday.
Surging oil and gas prices due to Middle East conflicts have fueled fresh inflation fears, causing traders to scale back bets on further easing by the Fed. This, in turn, lifts the Greenback and weighs on the USD-denominated commodity price.
“The recent volatility does not mean demand for gold as a safe-haven asset has weakened,” said Morgan Stanley analysts. “The slowdown is largely being driven by two forces: a stronger US dollar and investors seeking liquidity.”
However, escalating tensions in the Middle East could boost a traditional safe-haven such as Gold. Iran launched a fresh wave of missile and drone strikes across the Gulf on Thursday, with attacks reported in the United Arab Emirates, Bahrain, Qatar, and Kuwait.
Iranian Foreign Minister Abbas Araghchi said that Tehran hadn’t asked for a ceasefire and had no intention to negotiate, and Iran’s Islamic Revolutionary Guard Corps said retaliatory attacks will intensify in the coming days.
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