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Gold prices hold steady as market attention turns to Iran peace talks

Gold prices were stable on Thursday, after reaching a high of?one-month in the previous session.

As of 1:36 pm, spot gold was little changed at $4.785.57 an ounce. ET (1736 GMT). U.S. Gold futures ended the day 0.3% lower, at $4.80830.

Investors became concerned about inflation and the market's liquidity. The precious metal fell in March, after U.S. and Israel began a war against Iran in late-February. Gold is a?asset that yields nothing, so it tends to lose its appeal when interest rates rise.

Gold has recovered on the back of hopes that the U.S. will?achieve a lasting peace with Iran and end the conflict - bringing down the energy prices and decreasing expectations for higher rates. Peace talks are expected to resume between the two nations after previous talks broke down over the weekend. U.S. president Donald Trump announced in a post on social media that a ceasefire will begin?at 5 pm EST (2100 GMT) to stop a conflict that has erupted between Israel and Hezbollah, a Lebanese terrorist group that is aligned with Iran.

David Meger is the director of metals at High Ridge Futures. He said that if we see an easing in tensions between the U.S. and Iran or a war ending, the Federal Reserve will likely cut rates down the road.

Current?traders believe that there is a 32% probability of a U.S. rate cut in this year. New applications for the?U.S. Last week, unemployment benefits dropped, indicating that labor market conditions are stable. However, employers remain cautious in hiring, as the war against?Iran is a cloud over the economy. Silver spot fell 1% to $78.29 an ounce on Thursday. Silver is headed for its sixth consecutive year of structural deficit. Since '2021, 762 million troy ounces have been drawn from stock, raising the risk of another 'liquidity squeeze, despite lower demand expectations.

Palladium dropped 0.7% and platinum lost 0.6%, to $2,096.20. Ashitha Shivprasad reported from Bengaluru, and Emelia Sithole Matarise, Nia William and David Gaffen edited the article.

(source: Reuters)