Gold steadied around $4,050 an ounce on Tuesday, trading in a narrow range as investors tracked developments in US-Iran talks for clues on the potential reopening of the Strait of Hormuz, while continuing to evaluate the outlook for US Federal Reserve monetary policy.
President Donald Trump said his offer of talks represents Tehran’s final opportunity to reach a deal and expressed confidence that Hormuz will reopen soon.
Iran, however, denied that any direct talks with the US are underway, though it said discussions with Oman aimed at increasing shipping through the strait are making progress.
Meanwhile, markets are pricing in about a 65% chance of a 25 basis point Fed rate hike in September after the central bank left interest rates unchanged in July.
Bank of New York Fed President John Williams said monetary policy remains well positioned, adding that inflation is expected to ease during the second half of the year.