Gold rebounded on Tuesday as heightened geopolitical uncertainty stemming from Israel-Iran fighting and US President Donald Trump’s call to evacuate Tehran led investors to seek safe-haven assets.
Spot gold rose 0.2 percent to $3,388.57 an ounce after dropping more than 1 percent on Monday.
US gold futures fell 0.3 percent to $3,407.20.
“Market sentiment continues to swing between escalation and de-escalation regarding events in the Middle East, and these back-and-forth sentiment shifts are what is driving the gold price’s moves either side of the $3400 level,” KCM Trade Chief Market Analyst Tim Waterer said.
The fifth consecutive day of fighting between Israel and Iran saw Israel strike Iran’s state broadcaster on Monday, while the head of the U.N. nuclear watchdog reported extensive damage to Iran’s largest uranium enrichment facility.
Trump, returning early from the G7 summit in Canada Monday night, urged Iranians to evacuate Tehran, citing the country’s rejection of a nuclear weapons development curb deal.
Reports also indicated that Trump had requested the National Security Council to remain prepared in the Situation Room.
Gold is considered a safe-haven asset during times of geopolitical and economic uncertainty.
“There is enough prevailing uncertainty surrounding both tariff wars and actual wars to buttress the gold price and keep it within sight of a potential return to $3,500,” Waterer said.
