Gold prices fell in Asian trading on Monday after posting weekly gains, as US President Donald Trump warned of further escalation in the Middle East if Iran fails to reopen the Strait of Hormuz by Tuesday.
Spot gold fell 0.7% to $4,644.74 per ounce by 7:04 AM (Saudi Arabia time). Gold futures also declined, dropping 0.2% to $4,672.75 per ounce.
The precious metal had risen 4% in the previous week after giving up most of those gains in the final trading session on Thursday.
Market attention remained focused on President Trump’s latest warning to Iran that it must restore navigation through the Strait of Hormuz by 3:00 a.m. Wednesday Saudi time or face dire consequences.
Trump intensified his warning over the weekend in a Truth Social post, saying Tuesday will be Power Plant Day, Bridge Day, all together in Iran, indicating that Iranian civilian infrastructure could become a target if tanker traffic through the strategic waterway is not resumed.
However, a report by Axios late Sunday stated that the United States, Iran, and regional mediators are discussing the terms of a possible 45-day ceasefire that could eventually lead to a broader agreement to end the war.
About one-fifth of the world's oil shipments pass through the Strait of Hormuz, and the disruptions have caused prices to more than double this year.
Higher oil prices have added to inflation concerns, limiting gold's rise as investors increasingly expect US interest rates to remain high for longer.
Investors also assessed the latest U.S. jobs data, released while many markets were closed for the Good Friday holiday, which showed a stronger-than-expected labor market resilience.
The US dollar index rose 0.1% in Asian trading on Monday.
Among other precious metals, silver prices fell 0.6% to $72.58 an ounce, while platinum declined 0.4% to $1,985.60 an ounce.
