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Gold drops on stronger dollar and oil amid renewed Middle East hostilities
?Gold prices fell on Wednesday as a result of a stronger dollar, and rising oil prices. The conflict in the Middle East continued to dampen hopes for a quick resolution of the U.S. - Iran conflict. By 1128 GMT, spot gold had fallen 0.5% to $4463.74 an ounce. U.S. Gold Futures for August Delivery fell 0.6% to $4492.00. Gulf hostilities flared up again on Wednesday as an Iranian missile attacked Kuwait's airport, and the U.S. Military carried out strikes near the Strait of Hormuz. Diplomacy between Washington, Tehran and Tehran made little progress. Due to the renewed conflict in the Middle East, gold is under pressure and has been knocking against $4,450. Lukman Otunuga is a senior research analyst at FXTM. He said that fading hopes of a U.S. Iran peace deal will likely keep oil prices high. The dollar increased by?0.1%, and oil prices continued to rise for the third consecutive session. Oil prices rising increase inflation risk, which increases the likelihood of longer-term interest rate hikes. Gold is often viewed as an inflation hedge, but it loses its appeal when interest rates are high. According to CME Group’s FedWatch tool, the markets, who had?expected? two U.S. rate cuts in this year, before the Iran War, are now pricing in a 42 percent chance of a rate?hike? in December by 25 basis points. Beth Hammack, President of the Cleveland Federal Reserve, said on Tuesday that if inflation continues to rise at a high rate it may be necessary to increase interest rates. Investors are now awaiting the U.S. Nonfarm Payrolls Data for May due on Friday in order to gauge the U.S. Federal Reserve monetary policy direction. Otunuga said that a strong jobs report would likely add to the decline of gold, particularly if it led more traders to price in an interest rate increase by December. Silver fell by 1%, to $74.37 an ounce. Platinum dropped 0.4%, to $1,929.80. Palladium declined 1.3%, to $1,351.75. (Reporting and editing by Janane Vekatraman, Louis Heavens, and Noel John from Bengaluru)
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Trump claims Iran has agreed not to have nuclear weapons
U.S. president Donald Trump stated that Iran had agreed to?not have a nuclear weapons?and he will probably meet Supreme Leader Mojtaba?Khamenei at a certain point if "things work?out". In an interview that aired on Wednesday, Trump said about Iran: "They have already?agreed to not have a nuclear weapons." When asked about Khamenei?s involvement in the talks with the U.S. on ending hostilities Trump replied, "He is absolutely involved." ... "I think they have great respect for him." Trump claimed that he heard the Iranian leader saying?not too well' but giving his approval to the negotiations. Trump said that he did not have the "privilege" of meeting Khamenei. "I would like to meet him." We will probably meet at some stage, depending on the outcome of everything," Trump said. The U.S. President said that he considered the Iran war a success, because the military of the country had been defeated. The conflict, which began on February 28 with U.S. and Israeli strikes, has upset the global energy markets. It has also proven unpopular among Americans in the months leading up to November's congressional elections. In the interview, Trump said that Iran was a "big success". "We'll have to wait and see." We are going to do, we are working on a deal and it will be fine. It's fine if it doesn't work out. "We'll do it in the opposite way." He didn't?specify? what this might mean, but he has in the past said that the U.S. will resume strikes. Reporting by Doina Ghosh and Kanjyik in Washington; Editing by Andrew Heavens, Gareth Jones and Andrew Heavens
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Drone incursions cause chaos and fear along NATO's Baltic border with Finland
The presence of military drones in the airspaces of Finland, Estonia Latvia and Lithuania is raising concerns that the conflict in Ukraine could spill over into NATO's northern border with Russia. Some of Ukraine's drones missed their targets, causing security warnings to be issued in neighboring countries. In Latvia, this led to the collapse of the government. The following is a list of recent drone incidents that have involved Finland and the Baltic States: Two Ukrainian military drones that escaped from Russia enter Estonia and Latvia on March 25. One drone crashes into a chimney near the Russian border at Estonia's Auvere Power Station, while another crashes in Latvia. Lithuania reported earlier that a Ukrainian drone crashed into a lake. 29-30 March - Finland reports an alleged territorial violation in its southeast by unmanned aerial vehicle and deploys F/A-18 jet fighters. One object identified as a Ukrainian AN-196 swarm drone. According to Petteri Orpo, the Finnish Prime Minister, strong Russian electronic jamming may explain drones drifting in Finnish airspace. The 31st of March - Estonia, Latvia and Finland detect foreign drone activity close to their border with Russia. A drone is also found on the territory of Finland by its border guard. Estonia later discovers drone debris in Tartu County. Estonian armed forces claim that drones found in the country are believed to have originated from Ukraine and were intended for Russia. On May 7, Latvia and Lithuania ask NATO to increase air defences following the crash of two drones believed to have crossed from Russia. One of the drones 'explodes' at an oil storage site in the Latvian area of Rezekne causing damage to four empty oil tanks. Andris Spruds, Latvia's Defence Minister resigns on May 10, after Evika Silina says that anti-drone system deployment was not fast enough. Ukraine claims that the drones are Ukrainian, but were diverted to Russia by electronic warfare. Silina resigns from her position as Latvian prime minister on May 14, triggering the collapse in coalition government of Latvia after Spruds’ Progressives party withdrew its support. The authorities in Finland have warned 1.8 million people to stay inside because they suspect drone activity. They also suspended air traffic at Helsinki's capital airport and scrambled fighter jets. Alexander Stubb, President of Finland, says that Finland is not directly under military threat. May 17-18: Explosives were found near?the remains of a suspected Ukrainian drone that crashed near the border with Latvia and Belarus. Officials in Lithuania claim that the drone entered the country undetected. May 19: A Romanian NATO fighter plane shoots down an alleged Ukrainian drone after it entered Estonian airspace via Russia. Ukraine apologizes to Estonia and other Baltic Allies, saying that Russia redirected the drone via electronic warfare. It denies using Latvian and Estonian territory for strikes against Russia. Lithuania warns the people of Vilnius that they should take cover and stops traffic at its airport due to a drone in their airspace. Lithuanian legislators seek shelter underground in the parliament while train traffic has been suspended and schools and Kindergartens have been?told' to take their children to shelters. The government claims that the origin of the drone has not been verified. NATO fighter jets are attempting to combat this threat, and people living in areas bordering Russia or Belarus should seek shelter. June?3: Latvia and Estonia issue overnight warnings in areas bordering Russia asking residents to seek refuge if they suspect any suspected drone activity. According to Latvia, NATO fighter jets have scrambled in response. Estonian defence forces lifted the warnings in the morning, claiming that no drones had entered their airspace. Reporting by Jesus Calero, Jagoda Darland, Timothy Heritage and Peter Graff.
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Commission: EU governments can use a certain amount of fiscal flexibility for green energy to offset defence costs
Valdis Dombrovskis, European Economic Commissar, said that the European Commission would allow EU governments to make use of some of the fiscal flexibility already given to them for increased?defence expenditures, in order to fund a shift from fossil fuels to greener energy. This is in response to the pressure coming from Italy which will be holding elections next year. They are pushing for a softer approach to the EU fiscal rules, so that they can support the voters who face rising energy costs due to the U.S. and Israeli war against Iran, which has stifled oil and gas via the Strait of Hormuz. In order to comply with EU fiscal regulations, EU governments must keep their budget deficits under 3% of GDP. The?Commission ruled in March 2025, that each EU country must spend an additional 1.5% of GDP every year for four years to defend itself. Italy, unlike Finland, the Baltic states or Poland which all share a shared history of Russian occupation, sees the Russian menace as distant and instead of focusing on defence equipment, it wants to ease the pain of higher energy prices for Italian voters. Rome has been pushing the Commission to give EU governments fiscal flexibility to cushion the impact of more expensive energy even though very few other EU nations agree. The Commission decided that as a compromise it would allow EU countries the option to spend 0.3% of their GDP out of the 1.5% extra allowed for defense. This money could be used to fund investments to help transition fossil fuels into green energy. Dombrovskis stated that 0.3% of the GDP would be allowed per year, in 2026, 2027, and 2028. However, no more than 0.6% GDP will be allowed over three years. This could include, for example: the purchase of electric cars, switching heating systems from oil to gas, the installation solar panels or batteries, etc. He made it?clear that the leeway cannot be used to subventionise fossil fuels, as the Italian decision to reduce the excise taxes on petrol. Dombrovskis stated that tax reductions of this kind are not eligible. Dombrovskis stated that countries who decide to use 'the extra fiscal space allowed by the Commission for green energy' can deduct actions implemented since February. He said that EU countries like Lithuania and Estonia who have already spent all of their fiscal space of 1,5% of GDP on defense investment can still request the additional 0.3% after an analysis of debt sustainability. (Reporting Jan Strupczewski).
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Gunvor claims it is not the target of Swiss Prosecutor in bribery investigation
Gunvor, a global commodity trading company, confirmed on Tuesday that Swiss prosecutors had searched its office in Geneva. The company added that it was not the subject of the investigation. The Office of the Attorney General of Switzerland stated that the search was part of an?investigation into the bribery of officials abroad by unknown persons. The prosecutor stated that it could not provide any further information?on a ongoing investigation. Gunvor stated in its statement that it reported issues to the relevant authorities over a year earlier, and that?it is working with authorities. Gunvor had no knowledge about the Swiss investigation other than the fact that the company was not the target. Gunvor told the OAG that it had never reported any problems to them. Public Eye first reported the search of Gunvor’s?Geneva offices as part of an investigation, which according to the Swiss news outlet was a probe into Gunvor’s operations in 'Gabon. Gunvor said in its statement that it had conducted an internal investigation of its business in 'Gabon. It said that it had identified what it believed was fraudulent activity elsewhere totaling $2 million over a period of five years. Gunvor claimed this fraud was committed by an unnamed counterparty and maritime service provider, as well as an unnamed former employee. Reporting by Robert Harvey in LONDON and Shadia Nasralla; editing by David Goodman, Alexander Smith
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MORNING BID AMERICAS - Quantum leap
What's important in U.S. and Global Markets Today By Mike Dolan, Editor at Large, Finance and Markets Oil prices and bond rates have increased as the?hostilities? in the Gulf resume. But you won't find any signs of worry in AI-obsessed?stock?markets. Wall Street's SOX index rose?more? than 5% Tuesday, while the broader?S&P?500 closed at another record high for the ninth consecutive day. Deutsche Bank says that a S&P 500 gain of 10 on Wednesday will be the longest streak since more than 30 year. Below, I'll go into more detail. Check out my column about the calm that can be found beneath wild stock swings and how it may deceive. Listen to the Morning Bid Daily podcast. Subscribe to hear? Journalists discuss the latest news in finance and markets seven days a weeks. QUANTUM LEAP On Wednesday, the U.S. intercepted Iranian missiles in the Gulf - and carried out its own strikes. This pushed Brent crude up more than 2% at around $98 a barrel. At least in Asia, equity markets appeared to pay little attention to the news, as tech-heavy indices followed Wall Street on Wednesday and reached new record highs based on AI. Wall Street futures slipped before the bell rang, but European shares fell in early trading. The yen was flirting again with the 160-per dollar level, as recent U.S. and Iranian exchanges boosted greenback. Japanese authorities spent $73 billion on yen buying intervention to help support the currency, after it had previously fallen below that level. The tech calendar on Wednesday will be dominated by the earnings from Broadcom. They are due to be released after the bell. The chip maker is now a behemoth of $2 trillion at the heart of the AI buildout. Exclusive details about SpaceX's blockbuster listing were revealed. The company plans to set its IPO at $135 a share in order to raise a record $75 billion. Microsoft also claimed to have made a breakthrough with its new AI-redesigned?quantum chips that will make commercially viable machines possible within three years. On Tuesday, the jobs data were dominated by an unanticipated surge in April job openings. This raises doubts about the notion of a softening labour market, and will keep Fed watchers on alert. ADP's payrolls for the private sector are expected to be released 'later', before Friday's employment report. Chart of the Day Since 2025, the shares of Broadcom and Marvell Technology chip designers have risen on the back of a growing demand from hyperscalers for custom AI processors to reduce their reliance on Nvidia processors. Broadcom is scheduled to report its second-quarter earnings Wednesday. Marvell shares rose 25% on Tuesday, reaching a new record high. This was after Nvidia's CEO Jensen Huang referred to Marvell as the "next trillion-dollar company". Watch today's events * U.S. ADP private payrolls for May (8:15 a.m. ET), ISM services PMI (ten a.m. ET) * ?Fed issues Beige Book * Fed's Michael Barr, and?Dallas Fed Lorie Logan speak Want to receive Morning Bid in your email every morning? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed by the author are their own. These opinions do not represent the views of News. News is committed to the Trust Principles and to integrity, independence, freedom from bias, and impartiality.
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Germany opens window for dialogue between Europe and Russia
At a Wednesday briefing, a German government official said that a window of 'dialogue' is opening slowly between Russia and Europe on Ukraine. However, it will likely be months before any talks can begin. The official who requested anonymity said that it was important to create a dialogue format that Europeans would perceive as legitimate. The official also said that it was unclear who would lead these talks. However, there were strong indications that the E3 Group (Germany, France, and Britain) will continue to play a significant role in this regard. The Russian advance has slowed down this year. Ukrainian troops have intensified their 'long-range attacks in Russia and on St Petersburg, ahead of President Vladimir Putin’s annual economic forum, on Wednesday. The chief of staff to Ukrainian President Volodymyr Zelenskiy said that a deal ending the war before winter would be a "realistic outcome". According to the German official,'recent fighting suggests that it will take months rather than weeks to reach a stage where?talks could begin, and it is important to ensure they are conducted in full agreement with Ukraine. The official said that coordination - not competition - should be the guiding principle. Washington's mediated talks, which have been stalled due to its focus on Iran, are also at a standstill. The German and European governments rejected Putin's suggestion that the former German chancellor Gerhard Schroeder would represent them at future negotiations with Moscow. Reporting by Andreas Rinke; Writing by Miranda Murray; Editing by Madeline Chambers, Sharon Singleton and Madeline Chambers
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The Iran talks are at an impasse as Sterling struggles to find direction
The British pound has not changed much against the euro and dollar on Wednesday. Investors are still 'focused' on the conflict in?Middle East and the effects of a prolonged war on monetary policies. The talks to end the conflict are at a standstill. On Wednesday, an Iranian missile strike damaged Kuwait's Airport and the U.S. Military carried out strikes near Strait of Hormuz. Brent crude futures traded at their highest levels in a week on Wednesday. The United States is more vulnerable to rising fuel prices than Britain because of its greater dependence on imported energy. Prices have fallen from their late April highs but remain well above the levels they were before the U.S. and Israeli attacks on Iran in February that triggered the war. The pound last fell by about 0.1% to $1.3447. This is within the middle of its recent range. The?sterling exchange rate against the euro was unchanged at 86.34 cents. BOE RATE INCREASE PUSHED BACK Investors bet that the Bank of England will wait to raise rates. They have also lowered their expectations of future rate hikes since the beginning of the war. Money market futures do not fully price in a quarter point rate hike until September, and just under two are priced by the end of the calendar year. The market has given Bank of England the opportunity to wait it out as long as Strait of Hormuz opens soon, said Gustav Helgesson. The Bank of England can sit out this situation and, from a rate differential perspective, it should weaken sterling. Helgesson said that if the war ended, the pressure on public finances would be relieved, and this could have a positive effect on sterling. Investors are beginning to expect rate increases from the Federal Reserve, given the recent strong U.S. economic data and rising price pressures.
Copper prices fall as new attacks in the Middle East reduce risk appetite
The copper price?retreated? on Wednesday, after renewed hostilities in Iran's?war undermined the optimism of an imminent resolution and boosted the?dollar. However, the prospect of U.S. Tariffs have limited the downside. Benchmark 'three-month copper at the London Metal Exchange fell 0.9% to $13,914 per metric tonne by 0930 GMT. In the previous session it had reached its highest level in over two weeks, with a 1.5% gain. Gulf hostilities erupted on Wednesday, as diplomacy between Washington & Tehran showed little progress.
The markets have moved to a more risk-averse environment as a result of the exchange of fire.
Oil prices rose in a third session following the halting of U.S.-Iran talks.
A prolonged conflict will likely curb metals demand as inflation increases and economic growth is dampened. The Gulf skirmishes boosted demand for the dollar and made commodities priced in U.S. dollars more expensive to buyers who use other currencies.
The speculation that the U.S. could impose tariffs for refined copper before a deadline of June 30 to make a "determination" boosted prices.
U.S. Comex Copper Futures fell 1.2% to $6.60 a lb. This brings the premium of Comex to LME copper up to 4.5% or $631 a tonne.
This premium has attracted metal flows to the U.S., and tightened supplies elsewhere.
Shah stated that "the?premiums? are modest. If we hear any rumours about tariffs, copper could explode to the upside."
The Shanghai Futures Exchange's most active copper contract gained 0.4%, closing daytime trading at 106 380 yuan (15,712.51) per ton.
Nickel fell 1.1% to $19 045, while tin dropped 0.9% to $57450.
(source: Reuters)