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Gold prices fall as attention turns to US-Iran developments
Gold fell on Wednesday, after reaching a peak of one month. Investors were assessing the latest signals regarding the U.S./Iran situation to determine what it could mean for interest rates. As of 8:47 am, spot gold was down by 0.6% to $4,809.15 an ounce. ET (1247 GMT), having reached its highest level since March 18, earlier in the day. U.S. gold futures fell 0.4% to $4831.60. Jim Wyckoff is a senior analyst with Kitco Metals. He said, "Gold and Silver are only experiencing some mild and normal profit-taking following overnight highs." Gold prices are rising on the back of a?improved appetite for risk and falling during periods of risk aversion, which is contrary to its traditional role as a?safe haven. He said that traders are more concerned with the impact of tighter monetary policy and inflation pressures. U.S. president Donald Trump said that talks with Iran could resume soon and lead to a deal. He told the world to be on the lookout for "an amazing two days", as U.S. forces who imposed a blockade stopped vessels from leaving Iranian ports. As shipping through the Strait of Hormuz was restricted, oil prices rose. The strait remains closed 45 days after the Revolutionary Guards of Iran declared it closed. Despite a two-week ceasefire, the future of the transit is uncertain. Chicago Fed President Austan Goolsbee stated on Tuesday that the Federal Reserve could have to wait until 2027 before reducing interest rates, if the high oil prices caused by the Iran War continue to delay the inflation's progress toward the 2% target set by the U.S. Central Bank. The market currently believes that there is a 31% probability of a rate cut in the U.S. this year. Gold's appeal as a hedge against inflation is diminished by higher interest rates. Silver spot fell by 1.2%, to $78.61 an ounce. Platinum dropped 0.1%, to $2,101.82. Palladium rose 0.3% to $1,591.60. Ashitha Shivprasad, Bengaluru reporting; Jan Harvey editing.
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IMF warns against large fuel subsidies in response to war-driven energy shock
In its Fiscal Monitor report, released on Wednesday, the International Monetary Fund stated that the war in the Middle East had intensified the strains already present in an already fragile fiscal situation. Higher interest rates and rising energy prices have already fueled calls for assistance from developing countries and emerging markets. Rodrigo Valdes is the new head of fiscal affairs at the IMF. He said that countries should avoid fuel subsidies in order to help their citizens cope with an oil shortage and a corresponding rise in energy prices. He said that targeted, temporary cash transfers would be the better option. We don't have any oil. "We don't have oil." "Energy needs to be more costly for everyone so that we can adjust and consume less," Valdes said in an interview. The IMF cut its growth forecast on Tuesday due to energy price spikes caused by war and disruptions in supply. It warned that the global economic system could be pushed to the 'edge of recession' if the conflict intensifies and oil prices remain above $100 per barrel until 2027. Valdes stated that "you can pass on (higher energy costs) and do other things to help." "It is a global shock, and if countries suppress price signals, the global price would be higher." It is very important to send price signals so that demand can be adjusted. Valdes stated that the impact of the war would be determined by the export controls, damage to the energy infrastructure, and the ability of other countries to increase oil production. He said that once conditions stabilized it was important to stay focused on the longer-term issues, as public debt increased, primarily due to permanent spending on entitlements or reduced revenues in many of the world's largest economies. According to the IMF’s Fiscal Monitor, global government debt will reach 93.9% in 2025. This is up two percentage points compared to 92% one year prior. It will also be expected to reach 100 percent by 2029. That’s a full year sooner than was predicted just a few months ago. The report stated that this would be the highest level of government debt since World War II. The report said that the government debt would continue to rise and could reach up to 102.3% GDP by 2031. The IMF also said that interest payments had also increased sharply. They will reach nearly 3% GDP by 2025, up 2% from four years ago. Valdes warned about emerging risks. He said that hedge funds were less able to "hold debt on the long term." The duration of debt has also decreased, which means that short-term rates are more easily transmitted to debt dynamics. In a blog that accompanied the report, the IMF noted other challenges, including higher security costs, spending on energy and climate change, and increasing interest rates at a time where revenues have not kept pace. The IMF warned that trade and financial fragmentation would further stifle growth and increase borrowing costs. Political instability could also undermine reforms and revenue collections. Financial conditions could be tightened quickly by sudden changes in the markets, such as in AI stocks. Valdes said that countries should begin working on fiscal consolidation as soon as the immediate crisis is resolved. He said that while some countries are taking the issue seriously, many others have not yet developed a clear plan. "We are not in a crisis... but the longer you delay, the greater the effort you will need and the greater the chance of a disorderly consolidating later." Reporting by Andrea Shalal Editing done by Shri Navaratnam
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Putin criticizes Russia's top officials over economic contraction
On Wednesday, Russian President Vladimir Putin scolded top officials after the economy shrank by 1.8% during the first two months of the year. He asked them to 'come up with new measures that will boost the economic growth. The tight monetary policies of the central bank and Western sanctions that target the oil revenues of the country are the main reasons for the slowdown in Russian growth. The International Monetary Fund has raised its estimate of Russia's GDP growth in 2026 from 0.8% to 1.1% after the Middle East crisis spiked oil prices in March. The government has forecast growth of 1.3% for this year, but warned it could revise that figure lower later this month because of the lacklustre performance of the economy at the beginning of the year. Putin said that calendar factors alone were not enough to explain the contraction, telling his top economic officials including Maxim Oreshkin and Elvira Nabibullina of the central bank, as well as Finance Minister Anton Siluanov. "I would like to know why macroeconomic indicators are falling short," Putin said. He added that they were even falling short of officials' forecasts. Putin said he was expecting proposals for "additional?measures aimed at revitalizing growth," that would promote 'business initiatives and redirect skillful labour into sectors with greater growth potential. Putin stated that the government has?also prepared?a set of measures to reduce state?budget dependency on volatile global commodity market revenues, but did not provide any details. (Reporting and writing by Vladimir Soldatkin, Gleb Bryanski and Dmitry Antonov; Editing by PhilippaFletcher).
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Copper reaches six-week high amid hopes for new US-Iran Peace Talks
Prices of copper rose to a six-week high on Wednesday as optimism grew over the possibility of another round of talks between Iran and the United States aimed at ending the war. The benchmark copper price on the 'London Metal Exchange reached $13,392.5 per metric ton, its highest level since March 2. In official rings, it traded at $13,227, down 0.4%. The lower copper prices were attributed to profit-taking by traders, triggered in part by the stronger dollar. When it increases, metals priced in dollars become more expensive for those who hold other currencies. Traders said that the overall sentiment and volume of industrial metals was positive. U.S. president Donald Trump announced on Tuesday that talks to end the Iran War could resume in Pakistan within the next two day after the weekend's collapsed negotiations led Washington to impose an Iranian port blockade. Britannia Global Markets stated in a report that "risk appetite has returned following a temporary ceasefire last week. This is reinforced by reports Washington,?Tehran and China are planning to hold a second round in the next few days." The Yangshan Copper Premium, which is a measure of China's appetite to import copper, highlights expectations of a stronger demand. It has risen 270% to $74 per ton since the end January, and is now at its highest level since June of last year. The Chinese industrial metals market will be able to gauge the demand for industrial metals based on data that is due later this week. Due to disruptions in Middle East supplies, copper and nickel are being supported by fears about sulphur shortages. Middle East is responsible for 24% global sulphur. It's a byproduct from oil and gas refineries. Last year, its aluminium production amounted at nearly 7?million tonnes or 9% global?supplies. Aluminium prices are at a four-year high. Aluminium rose 0.1% to $3,565 per ton. Zinc rose 1.2%, to $3,382, while lead climbed 0.8%, to $1,951.5. Tin fell 0.3%, to $50,175; and nickel grew 0.6%, to $18,385.
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Trump claims he told China's Xi to not give Iran weapons
Donald Trump told Fox 'Business 'Network that he asked Chinese President Xi Jinping a question in a letter, asking him not to supply weapons to Iran. Xi replied that China did not supply tehran. In the Tuesday interview, Trump did not specify when the letters had been exchanged. He threatened to impose an immediate 50% tariff on countries that supplied Iran with arms last week. "I sent him a note asking him to not do that and he replied with a message saying that he is not doing it," Trump said on?FBN’s "Mornings with Maria". He said he didn't expect changes to the global oil markets due to the war against Iran or Venezuelan political developments would affect the dynamics of the planned meeting between him and Xi in the next month. "He is someone who needs oil." We don't," Trump said. In a later Truth Social post, Trump also stated that he would "permanently"?open? the Strait of Hormuz. China was extremely happy with this. "I'm doing it for the World, too," Trump wrote. He added: "President Xi is going to give me a huge, fat hug when I arrive in a couple of weeks." Trump's statement that shipping through the Strait of Hormuz is still restricted was not immediately understood. The White House didn't immediately respond to an inquiry for clarification about the president’s post. Even with the current two-week ceasefire, the future of the waterway is uncertain 45 days after Iran's revolutionary?Guards closed the strait, effectively blocking 20% of the world's oil and liquefied gas shipments. Sources?said that traffic is only a fraction of the 130 daily crossings before the war. Trump said that talks between the United States and Iran to end the war may resume this week after ending over 'the weekend with no agreement. The?U.S. The?U.S. (Reporting and editing by Andrew Heavens, Hugh Lawson and Humeyra Pamuk)
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Four dead in Turkey after second school shooting within two days
The local governor reported that a student killed?at least?four people, including fellow students, and injured at least?20 other at a middle-school in southeast Turkey on Wednesday. This was the second school attack to occur in the country in just two days. Governor Mukerrem Unluer said that three?students? and one teacher?died in the incident which occurred in Kahramanmaras province. The attacker died in the attack. The governor said that the student, who was in eighth grade at the school, had hidden their father's guns inside a backpack and used them to commit the attack. In Turkey, school shootings are rare. On?Wednesday, television footage showed ambulances arriving to the school where crowds and police had gathered by the gate. Justice Minister Akin 'Gurlek'said on X a probe was opened into the attack. A former student opened fire on a school, in the province of Sanliurfa (southeast Turkey), wounding at least 16 people including teachers and students. He then killed himself.
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Investors focus on US-Iran talks as gold falls from its peak of one month
Gold prices eased on Wednesday from their one-month-highs, as investors weighed the progress of the U.S. and Iran talks to end hostilities in Middle East, while oil prices held firm due to supply concerns resulting from the closure of the Strait of Hormuz. As of 1131 GMT spot gold was down by 0.7% to $4,806.77 an ounce after reaching its highest level since March 18 a few hours earlier. U.S. Gold Futures for June Delivery fell 0.4% to $ 4,829.70. It's possible that it is a spurious correlation, given the fact (that) both gold and equities react to changes in oil prices. Low oil prices are good for the economy, and therefore good for stocks. Low oil prices and low inflation are good for gold, because central banks can "cut rates", said UBS analyst Giovanni Staunovo. Oil prices are up by over 1%, as the Strait of Hormuz remains closed. This has caused a restriction on exports. Staunovo said, "I'd say that it's an wait-and see mode to gain more clarity on what will happen next. Because nothing is moving very much at the present." Trump said that negotiations between U.S. officials and Iranian officials may resume in Pakistan within the next two day. The U.S. also claimed that its military had halted all trade entering and leaving?Iran via sea. Since the U.S. launched its war against Iran on February 28, oil prices have soared. Gold is often viewed as an inflation hedge, but rising interest rates have dampened its appeal. According to CME's FedWatch Tool, investors see a 31% likelihood of at least one U.S. 25-basis point?rate reduction this year. This is down from 34% on February. Silver fell by 1%, to $78.77 an ounce, while platinum rose 0.2%, to $2,107.36. Palladium rose 0.6% to $1,596.74; both metals reached a new high. (Reporting by Ishaan Arora in Bengaluru; Editing by Louise Heavens)
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India's gems and jewelry exports have fallen to a five-year low due to US tariffs
India's gems, jewellery and watch exports fell 3.3% in fiscal year 2025/26 from the previous year to reach their lowest level since?five years. This was due to shipments to India's top customer - The United States. A leading trade group said that the number of exports nearly halved on Wednesday due to tariffs and duties. The Gem and Jewellery?Export Promotion Council (GJEPC), in a press release, said that the gem and jewellery exports for the year ended March were $27.72 Billion, which is the lowest level since 2020/21 when pandemics led to lockdowns, disrupting trade. GJEPC data shows that shipments to the U.S. dropped 45% compared to a year earlier to $5.09billion, with exports disrupted for a few?months following Washington's?reciprocal duties and later a 25% additional duty on Indian products. The GJEPC reported that cut and polished diamond exports fell by 8.5% on an annual basis to $12.16 billion, the lowest level in over two decades. India is the largest hub for cutting and polishing diamonds in the world, with nine out of ten diamonds processed globally. Kirit Bhansali said that despite the fact that exports to the United States fell because of tariff concerns, other markets, such as the United Arab Emirates (UAE), Hong Kong, Australia and Canada, showed strong growth. He said that the upcoming?implementation?of free trade agreements?with?the UK?and EU?this year will support India's growth in gem and jewellery exports. (Reporting and editing by Keith Weir.)
Japan provides $10 billion to support Asian neighbours in securing oil
Japan said?on Wednesday that it would create a financial structure worth $10 billion in order to assist Asian countries with the procurement of energy resources, and bolstering their stockpiles. Middle East tensions are driving prices up and disrupting supply chains.
Support, aimed at preventing negative effects on Japan's supply chains, will be provided primarily through state-backed institutions, such as Japan Bank for International Cooperation, (JBIC), and Nippon Export?and Investment Insurance, (NEXI).
Sanae Takaichi, the Prime Minister of Japan, announced the plan. He said that the financial support would be equal to 1.2 billion barrels of oil or roughly one year of crude oil imported by the Association of Southeast Asian Nations. She spoke after a meeting of "AZEC plus" under the Japan-led Initiative, Asia Zero-Emission Community.
The meeting was attended by leaders from the Philippines, Malaysia Singapore, Thailand, and Vietnam, among others.
Takaichi told reporters that "we are closely connected with Asian countries via supply chains and other channel, and we're mutually dependent" after the meeting, citing a number of examples, including surgical drains and dialysis equipment.
Supporting the supply chains of Asian countries would boost Japan's economy."
The plan provides credit to local companies for alternative resources, such as U.S. Crude Oil. It also includes financing and loans provided for companies and government that are part Japan's supply chains.
Included is support to diversify energy sources, and increase partner country stockpiles by building storage tanks.
Southeast Asian countries have smaller oil stocks than Japan. This means that supplies of naphtha, a vital feedstock for plastics, are becoming increasingly scarce. The disruption of production in Southeast Asia has caused anxiety among Japanese healthcare providers who rely on Asia to supply critical supplies like tubes, containers and gloves.
According to the Japan Agency for Natural Resources and Energy, 90% of crude oil that passes through the Strait of Hormuz will be shipped to Asia.
Tokyo has said that it has enough naphtha to last four months for domestic use. However, in recent days a growing number manufacturers have reported a disruption of deliveries. The government announced on Wednesday that it will release "another 36,000,000 barrels" from its oil reserves starting in early May.
Takaichi refused to comment when asked if countries had?requested to access Japan's oil reserve following the AZEC+ meeting. He did, however, stress that the agreement would not include a release of the stockpile or affect the domestic supply. (Reporting and editing by Kim Coghill, Tamiyuki Khara, Makiko Yamazaki; Additional reporting by Chang-Ran Kim)
(source: Reuters)