Gold declines as attempts to restart US-Iran peace talks falter

Published Mon, Apr 27, 2026 · 07:52 AM

GOLD fell after efforts to resume peace talks between the US and Iran stalled and energy flows via the Strait of Hormuz remained choked, two months into a war that’s upended global markets and raised inflation risks.

Bullion dropped as much as 0.6 per cent to near US$4,680 an ounce, extending a 2.5 per cent decline in the previous week. US President Donald Trump cancelled a planned trip by his top envoys to resume peace talks with Iran in Islamabad, while Teheran said that it will not negotiate as long as it’s being threatened.

Oil gained on Monday (Apr 27), as Hormuz remained virtually impassable due to blockades set up by both countries. The energy-supply shock caused by the war has added to inflation risks, raising the likelihood that central banks will keep interest rates steady for longer or even hike them, which is a headwind for non-yielding bullion. Gold has lost about 11 per cent since the conflict began at the end of February.

Gold is “in technical no-man’s-land”, Nicky Shiels, head of research and metals strategy at MKS Pamp, said. “Conviction is thin, larger allocations remain sidelined, physical is mixed, and ‘lost’ is probably the most honest word for where the market is right now.”

Traders are assessing the Federal Reserve’s path on borrowing costs after US Attorney Jeanine Pirro said on Friday that she’s dropping an investigation into cost overruns at the US central bank, opening the path for Trump pick Kevin Warsh to become its next chair. Investors do not expect Warsh to deliver the aggressive rate cuts urged by the president, but rather pursue a measured approach with gradual moves to lower rates.

In the Middle East, the effective closure of Hormuz has disrupted around a fifth of the world’s oil flows. A fragile ceasefire largely held over the weekend but Trump told his envoys, Jared Kushner and Steve Witkoff, to skip their trip to Pakistan, which is mediating talks. Iranian President Masoud Pezeshkian said his nation will not enter “imposed negotiations under threats or blockade”.

“The ‘ceasefire-on/ceasefire-off’ headline roulette has conditioned the market,” Shiels said. “With gold now behaving as a risk asset – negatively correlated with oil, loosely positively correlated with equities but a poor proxy for both – there’s little appetite to chase it sub-US$5,000.”

Spot gold fell 0.5 per cent to US$4,685.14 an ounce at 6.40 am in Singapore. Silver dropped 0.8 per cent to US$75.10 an ounce. Platinum and palladium also retreated. The Bloomberg Dollar Spot Index, a gauge of the US currency, rose a further 0.1 per cent after adding 0.3 per cent last week. BLOOMBERG