Gold falls to near $4,050 amid US- Iran talks uncertainty

Gold price (XAU/USD) attracts some sellers to around $4,060 during the Asian trading hours on Monday. The precious metal declines amid uncertainty surrounding US-Iran talks and hawkish Federal Reserve (Fed) expectations. The US Nonfarm Payrolls (NFP) data will take center stage later on Thursday. 

The United States (US) and Iran agreed to halt attacks and plan to meet in Doha, Qatar, on Tuesday to resolve their dispute over the Strait of Hormuz, Axios reported. US officials stated that Washington and Tehran “will stand down for now” following an exchange of fire near the critical waterway over the last several days. 

However, uncertainty remains high as Iran’s Foreign Minister Abbas Araghchi said that responsibility for the Strait of Hormuz lies solely with Tehran. An Iranian official warned that any attempt to bypass its preferred route in the waterway will cause “tension and escalation.” Any signs of rising tensions in the Middle East could raise inflation worries, prompting traders to raise their bets on rate hikes and weighing on the non-yielding bullion.

Traders are now pricing in nearly a 59.7% chance of a rate hike as early as September 2026, according to the CME FedWatch Tool. The upcoming NFP and labor market reports on Thursday will offer some hints about the US interest rate path. Economists forecast an increase of 114,000 jobs in June and the Unemployment Rate holding steady at 4.3% during the same period.