Gold Prices Steady as Fed Decision and Middle East Tensions Loom

Gold prices held firm in Asian trading Wednesday, with investors cautious ahead of the U.S. Federal Reserve's interest rate decision later in the day. Ongoing geopolitical tensions between Israel and Iran, along with signs of possible U.S. military involvement, kept demand for safe-haven assets elevated.

Spot gold was unchanged at $3,388.25 per ounce, while August gold futures hovered near $3,405.95. The metal had pared recent gains earlier in the week on reports of a potential ceasefire from Iran. However, a renewed wave of military strikes and President Donald Trump’s aggressive stance toward Tehran reignited risk-off sentiment.

The Wall Street Journal reported that Trump is weighing U.S. military strikes targeting Iran's nuclear infrastructure, demanding the country’s "unconditional surrender." A Reuters report added that the U.S. is sending more fighter jets to the Middle East and extending other deployments—moves the Pentagon labeled defensive but seen by markets as escalating involvement.

Meanwhile, weak U.S. economic data further supported bullion. May retail sales fell 0.9%, reinforcing expectations that the Fed could shift toward rate cuts later this year. While a policy hold is widely expected at today’s Fed meeting, investors are watching closely for revised economic forecasts.

A weaker U.S. dollar also supported precious and industrial metals. The U.S. Dollar Index slipped 0.2%, making commodities priced in dollars more attractive to foreign buyers.

Silver futures rose 0.6% to $37.365 per ounce, while platinum gained 0.5% to $1,269.90. Copper prices also climbed, with London futures up 0.3% at $9,703.75 per ton and U.S. copper futures jumping 0.9% to $4.83923 per pound.

With geopolitical risks and economic uncertainty in focus, gold is likely to remain well-supported in the near term.