Gold Prices Tumble On Inflation, Rate Hike Jitters

(RTTNews) - Gold prices fell nearly 2 percent on Thursday as the dollar remained near recent highs on inflation fears and hawkish Fed bets.

Spot gold tumbled 1.9 percent to $4,420.05 an ounce as oil topped $100 a barrel again amidst conflicting developments in the Middle East. U.S. gold futures were down 3 percent at $4,453.

While the U.S. insists negotiations are ongoing, the Islamic Republic dismissed President Trump's plan for a truce and launched more attacks on Israel and Gulf Arab countries.

According to media reports, Iran laid down its own conditions for any ceasefire after rejecting the U.S. proposal as "excessive."

The five conditions outlined by Tehran include the cessation of U.S. and Israeli military actions against Iran, guarantees against future aggression, reparations for war-related damages, an end to hostilities on all fronts—including conflicts involving Iran-aligned groups in the region—and recognition of Iranian sovereignty over the Strait of Hormuz, a vital international shipping route.

Meanwhile, the U.S. has ordered thousands of troops to the region despite growing opposition among Republicans, as well as Democrats, about the dangers involved.

Treasuries rose while the dollar was steady against major currencies despite recent gains.

Earlier today, European Central Bank (ECB) member and Bundesbank President Joachim Nagel said that the European Central Bank may hike interest rates at its next meeting in April "if the war in the Middle East raises the spectre of an inflation surge in the Eurozone".

ECB President Christine Lagarde said Wednesday that anything more than a short-lived spike in inflation could warrant an increase in interest rates.