Donald Trump ordered the United States Navy to fire on every ship laying mines in the Strait of Hormuz.
Gold vs. Geopolitics. "Pat Still Lasts"
Although a few days ago it seemed that the war in the Middle East was ending, today nothing is certain.
"I ordered the US Navy to shoot and destroy every boat, even if they are small units (all their warships, 159 in number, lie on the sea floor!), that place mines in the waters of the Strait of Hormuz," he said.
"There can be no talk of any hesitation. Moreover, our destroyers are now clearing the strait. I hereby order the continuation of these actions, but at triple level!" he added.
Meanwhile, the U.S. military reported the capture of two supertankers that tried to bypass the maritime blockade of the region.
According to the Pentagon, U.S. forces boarded the “sanctioned stateless ship” transporting oil from Iran at night.
These are the details that suggest the conflict has not yet ended. On the other hand, we receive signals indicating potential de-escalation.
The White House stated that Donald Trump, despite media reports, has not set exact dates for ending the ceasefire with Iran.
Furthermore, as The Wall Street Journal reports, Americans have already used so much ammunition in the Middle East that White House officials are increasingly worried that their country will not be able to defend Taiwan against a potential Chinese invasion if it were to occur soon.
What numbers are we talking about? The Pentagon used over 1,000 Tomahawk missiles and 1,500 to 2,000 critical air defense missiles. Replenishing these stocks could take… six years.
The market therefore receives conflicting signals, which have raised Brent crude to about 106 USD.
Yield on Treasury bonds and the dollar also rose. To make matters worse, higher energy prices, driven by the rising cost of "black gold," have fueled concerns about ongoing inflationary pressure, which could prompt the Federal Reserve to maintain high interest rates for longer.
A weakening dollar and the potential lack of rate cuts make gold lose appeal to investors, even though in the current geopolitical turmoil, it should "rise like a textbook".
"Investors seem not to fully believe in an indefinite truce in the U.S.-Iran conflict announced by Donald Trump on Tuesday evening," said Marek Rogalski, chief market analyst at DM BOŚ.
"Pat still lasts and the question is who will lose patience first – plus the 'dangerously' approaching weekend, the period when financial markets are closed and various military provocations can be carried out. Iran has already threatened that any U.S. move will be met with a strong response in the form of destroying oil extraction and transit facilities in neighboring states," he added.
Source: Truth Social.
See also: Gold price fell 12%, will there be further discount soon? Expert: "With possible de-escalation there is a chance to recover losses"
Gold Price at a Geopolitical Turn
One ounce of gold currently costs 4,680 USD.
Chart. Gold spot market price (XAU/USD)
Source: Trading Economics.
One ounce of silver currently costs 74,8 USD.
Chart. Silver spot market price (XAG/USD)
Source: Trading Economics.
Read also: Gold price changed! Soon correction or breakout? Expert says what next for XAU/USD
See also: Gold and silver before new ATH? Tensions on the USA-Iran-Israel line could accelerate the metal rally
Sources: Bloomberg, Bossa, The Kobeissi Letter, Truth Social.
